China reaffirms commitment to reform, opening-up at 'two sessions'

Those keen to understand the trajectory and focus of the world's second-largest economy will find a recurring theme at China's "two sessions" this year — reform and opening-up.

At the annual sessions of China's national legislature and top political advisory body, reform was once again highlighted across a broad spectrum of areas, ranging from rural development and improving fiscal, tax and financial systems to education and health care.

The "two sessions" agenda has also underscored China's commitment to expanding high-standard opening-up and stabilizing foreign trade and foreign investment.

"Regardless of changes in the external environment, we should remain steadfast in our commitment to opening-up," said a government work report submitted to China's national legislature.

"We should steadily expand institutional opening-up and take the initiative to open wider and advance unilateral opening-up in a well-ordered way, to promote reform and development through greater openness."

Why it matters

China's commitment to reform and opening-up is reflected in the latest development on the country's southernmost island province of Hainan, where the free trade port will begin independent customs operations in 2025.

On the sidelines of the "two sessions," Cai Qiang, a national legislator and deputy director of the Office of the Hainan Free Trade Port Working Committee, said the tax system tailored to the Hainan Free Trade Port is taking shape, and efforts will be made to further upgrade its preferential tax policies.

China pledged to accelerate the implementation of core policies for the free trade port this year, and improve opening-up and development policies for economic development zones, according to the government work report.

From deepening reform in its special economic zones already established to further easing market access restrictions for investment, China has consistently championed reform and opening-up, boosting its high-quality development and sharing opportunities with the rest of the world.

Since 1978, reform and opening-up has transformed a once-impoverished country into a market-oriented economic powerhouse, with China's per capita GDP surging from US$156.40 in 1978 to US$12,614.10 in 2023.

China's GDP grew by 5 percent year on year in 2024, ranking among the world's fastest-growing major economies and continuing to contribute about 30 percent to global economic growth.

Yet challenges remain. Domestically, the country faces headwinds, including insufficient demand to reinforce its economic recovery while fostering innovation-driven development. Globally, businesses must navigate escalating trade tensions, rising protectionism and the latest wave of technological revolution reshaping industries, production models and lifestyles.

The Chinese leadership has made it clear that challenges arising from reform and opening-up can only be solved by pressing ahead with reform and opening-up, demonstrating a firm determination to address the risks and obstacles on the path ahead.

China targets an economic growth rate of around 5 percent this year, as policy-makers are determined to secure a steady recovery through decisive and effective measures.

"By deepening reform, opening-up and innovation across the board and enhancing the intensity of our macro policies, we will develop new drivers of growth and have the ability and conditions to achieve this target," according to a report from the State Council on the implementation of the 2024 plan for national economic and social development and on the 2025 draft plan.

Liao Wenbin, a national legislator and mayor of Yibin City in southwest China's Sichuan Province, sees 2025 as a crucial year for further, more comprehensive deepening of reform and opening-up, saying that reforms are set to open up a broader space for the country's high-quality development.

What it means to the world

Though the "two sessions" focus mainly on China's domestic development policies, China's high-quality development is increasingly creating shared opportunities for the world, and its open market is becoming truly global.

In a world filled with uncertainties, the "two sessions" have sent an unequivocal message: China is committed to expanding high-standard opening-up and continues to share development opportunities with the world.

According to this year's government work report, China will broaden international cooperation by further opening-up to promote greater mutual reinforcement and higher-standard positive interplay between domestic and international economic flows.

"Opening-up has been a pivotal driver of China's development, and the Chinese government remains steadfast in its commitment to advancing openness, pushing to open its doors even wider," Shen Danyang, director of the Research Office of the State Council, told a press briefing when elaborating on the report.

This year's report outlines several new measures for opening-up, highlighting efforts to foster a first-rate business environment that is market-oriented, law-based and internationalized, Shen said.

Embracing on the country's emerging opportunities, foreign giants like Tesla and BMW have expanded their presence in China, leveraging its vast industrial ecosystems and consumer market to drive breakthroughs in electric vehicles, renewable energy and advanced materials.

A recent report from the American Chamber of Commerce in South China shows that 58 percent of foreign companies surveyed consider China to be one of their top three investment priorities, and 76 percent plan to reinvest in the country in 2025.

Jiang Ying, Deloitte China chair and a national political adviser, emphasized that China's ongoing commitment to high-standard opening-up will draw greater international capital and technology to the Chinese market while simultaneously boosting the global reach of Chinese products and services.