Shenwan Hongyuan Zhao Wei: Review of the "14th Five-Year Plan" and Outlook for the "15th Five-Year Plan"

As the core tool for macroeconomic management in our country, the Five-Year Plan has always carried the function of connecting the phased deployment of national development strategies with long-term goals. The "14th Five-Year Plan" (2021-2025) serves as the first five years of comprehensively building a modern socialist country, promoting key tasks such as high-quality economic development, breakthroughs in technological innovation, improvement of people's well-being, and green transformation in a complex and changing domestic and international environment. The achievements and challenges at the conclusion of this period lay the foundation for the "15th Five-Year Plan" (2026-2030). The "15th Five-Year Plan" period, as a crucial five years towards the goal of basically achieving socialist modernization by 2035, may undertake the historical mission of deepening reforms, tackling green transformation, cultivating new productive forces, and improving social security. Based on this, the author systematically reviews the implementation effectiveness and policy evolution of the "14th Five-Year Plan" and attempts to conduct a forward-looking analysis of the possible development context and core focus areas of the "15th Five-Year Plan." Review of the "14th Five-Year Plan": Achievements, Challenges, and Policy Evolution Characteristics of the "14th Five-Year Plan": Upgraded goal orientation, increased emphasis on people's livelihood and security The development concept of our country's "Five-Year Plan" has undergone a series of evolutions. The "1st Five-Year Plan" to the "5th Five-Year Plan" was more guided by the "General Line for the Transition Period" and the "General Line for Socialist Construction," emphasizing the goal of achieving industrialization through catch-up development, with a strategic focus on prioritizing the development of heavy industry. From the "6th Five-Year Plan" to the "9th Five-Year Plan," the emphasis shifted to using reform and opening up as the driving force, with the core goal of pursuing economic growth and developing social productivity. The management approach gradually transitioned from administrative directive planning and direct government resource allocation to macroeconomic management that conforms to market economic laws, significantly reducing the scope and indicators of planned management, streamlining management institutions, and decentralizing planning decision-making authority. From the "10th Five-Year Plan" to the "13th Five-Year Plan," there was further emphasis on sustainable development, gradually proposing development concepts such as "people-oriented" and "scientific development." The "14th Five-Year Plan," "15th Five-Year Plan," and "16th Five-Year Plan" anchor the goal of basically building a modern socialist strong country by 2035. In light of the issues raised in the "14th Five-Year Plan," such as "the reform tasks in key areas are still arduous, innovation capabilities do not meet the requirements for high-quality development, the agricultural foundation is still unstable, there are significant disparities in urban-rural regional development and income distribution, ecological and environmental protection is a heavy burden, there are shortcomings in social security, and there are weaknesses in social governance," the "14th Five-Year Plan" has made deployments in eight major areas: economic development, industrial innovation, regional layout, rural revitalization, people's well-being, green ecology, cultural soft power, and security. Compared to previous plans, the "14th Five-Year Plan" presents three major characteristics. First, the upgrade of goal orientation. The "14th Five-Year Plan" no longer sets specific numerical values for GDP growth rates, but instead weakens speed and strengthens quality, incorporating quality indicators such as labor productivity and the proportion of the core industries of the digital economy into assessments. This shift marks a transition in our country's economic development model from "speed priority" to "quality priority," aiming to promote connotative economic growth. Second, there is a significant increase in the weight of people's livelihood in the "14th Five-Year Plan." The plan sets 7 indicators related to people's livelihood, accounting for more than one-third, covering resident income growth, the number of childcare places for infants and toddlers, per capita life expectancy, etc., reflecting China's rebalancing of the relationship between efficiency and equity in the new stage of economic development. Thirdly, the comprehensive strengthening of safety dimension goals in the "14th Five-Year Plan." The plan adds safety assurance indicators such as comprehensive grain production capacity and comprehensive energy production capacity, and at the industrial development level, it focuses more on building a self-controllable, safe, and efficient industrial chain supply chain system. Review of the "14th Five-Year Plan" Achievements: Initial Practice on the Path of High-Quality Development The "14th Five-Year Plan" period (2021-2025) marks the first five years of China's comprehensive construction of socialist modernization, with significant achievements, as most core indicators have been met or exceeded expectations. During the "14th Five-Year Plan" period, China's total economic output has continuously crossed multiple trillion yuan thresholds, expected to reach around 140 trillion yuan by 2025, with a contribution rate to global economic growth maintained at around 30%, demonstrating strong resilience. In terms of innovation, by 2024, the intensity of R&D expenditure across society is close to the average level of OECD countries, with R&D investment intensity increasing to 2.68%, and the scale of R&D expenditure across society growing by nearly 50% compared to the end of the "13th Five-Year Plan." Forest coverage has increased to over 25%, and energy consumption per unit of GDP has significantly decreased. Meanwhile, the well-being of the people continues to improve, with new urban employment stabilizing at over 12 million each year. These achievements collectively lay a solid foundation for fully completing the goals of the "14th Five-Year Plan" and achieving high-quality development. While significant achievements have been made, the implementation of the "14th Five-Year Plan" also faces many challenges. The mid-term evaluation report clearly points out that the "bottleneck" issue of key core technologies remains prominent, restricting the safety and self-controllability of the industrial chain supply chain. In addition, the long-term mechanism for expanding resident consumption is still not sound, and key area reforms still need to overcome difficulties. Some binding indicators, such as the reduction progress of energy consumption per unit of GDP and carbon dioxide emissions, lag behind expectations. Although substantial progress has been made in terms of total economic output and structural optimization, there is still considerable room for improvement in deeper issues such as development quality, smooth internal and external circulation, and risk prevention. Policy Evolution During the "14th Five-Year Plan": Promoting Green Upgrading, from Extensive Management to "Scientific" Transformation In the early stages of the "14th Five-Year Plan," some regions adopted "one-size-fits-all" production and electricity restriction measures to quickly achieve energy consumption dual control targets. In 2021, the industrial added value growth rate in some regions sharply declined in the short term due to these "one-size-fits-all" measures. Against this backdrop, at the end of 2021, the Central Economic Work Conference clarified that "newly added renewable energy is not included in the total energy consumption control," shifting the policy focus from total control to structural optimization; in 2022, the report of the 20th National Congress of the Communist Party proposed to improve the total and intensity control of energy consumption, focusing on controlling fossil energy consumption, and gradually transitioning to a "dual control" system for total carbon emissions and intensity; the implementation of the "2024-2025 Energy Saving and Carbon Reduction Action Plan" in 2024 further refines the transformation goals by industry, marking a shift in regulatory methods from administrative directives to market-oriented scientific transformation This round of energy conservation and emission reduction may focus on guiding policies such as tax incentives and financial subsidies, replacing "supply contraction" policies, to direct capital in high-energy-consuming industries towards energy-saving and carbon-reduction technologies. In 2024, the average growth rate of industrial added value in six major high-energy-consuming industries will maintain a high level of 4.2 percentage points, while the growth rate of electricity consumption is only 2.6%, indicating that enterprises have not been forced to stop production due to environmental constraints, but instead have achieved transformation through technological upgrades. The shift in policy models not only avoids the economic shock of a "one-size-fits-all" approach but also achieves a positive interaction between economic growth and green development, providing important support for high-quality development during the "14th Five-Year Plan." "15th Five-Year Plan" Outlook: The Key Five Years Towards 2035 Historical Positioning of the "15th Five-Year Plan": A Key Five Years of Continuity and Transition The "15th Five-Year Plan" period (2026-2030) is a critical five years in the journey of building a modern socialist country (see Figure 1). As an important part of the strategic deployment of the 20th National Congress of the Communist Party, the "15th Five-Year Plan" forms a continuous process together with the "14th Five-Year Plan" and "16th Five-Year Plan" towards the goal of basically achieving socialist modernization by 2035. The "14th Five-Year Plan" period is the initial stage for laying the foundation and clarifying the direction, while the "16th Five-Year Plan" period will focus on sprinting to the finish. The "15th Five-Year Plan" period is at a transitional midpoint, deepening the advancement of the "14th Five-Year Plan" while also serving as a key stage for mid-term evaluation of the 2035 goals. Source: Chinese Government Website, Shenwan Hongyuan Research The "15th Five-Year Plan" may be linked to high-quality economic development, deepening green transformation, and reforms in key areas. In terms of high-quality economic development, to achieve the long-term goal of doubling the total economic output or per capita GDP by 2035 compared to 2020, China's total economic output needs to maintain an average nominal growth rate of around 4% during the "15th Five-Year Plan" period (with actual GDP growth possibly around 4.5%). In terms of timelines, by 2029, over 300 reform tasks deployed at the third plenary session of the 20th National Congress need to be completed, and by 2030, the proportion of non-fossil energy consumption should reach around 25%, and carbon emissions per unit of GDP should decline by over 65% compared to 2005 to achieve the carbon peak target. In terms of deepening green transformation, the plan may focus on accelerating structural adjustments and green and intelligent upgrades in the industrial development sector. According to the "Carbon Peak Action Plan Before 2030," by 2025, the proportion of non-fossil energy consumption should reach around 20%, and energy consumption and carbon emissions per unit of GDP should decline by 13.5% and 18%, respectively, compared to 2020. On this basis, the "15th Five-Year Plan" period will further tackle challenges to ensure that by 2030, the proportion of non-fossil energy consumption reaches around 25%, and carbon emissions per unit of GDP decline by over 65% compared to 2005, successfully achieving the carbon peak target However, from the mid-term assessment, some ecological and environmental protection indicators in the "14th Five-Year Plan" are lagging behind expectations. According to the mid-term evaluation report, by the end of 2023, although 20 major indicators of the "14th Five-Year Plan" have achieved "half the time, half the tasks," the progress in reducing energy consumption per unit and carbon emissions is significantly low. Considering that the cumulative reduction in carbon emission intensity from 2021 to 2023 is 4.6%, to achieve the total reduction target of around 18% set by the "14th Five-Year Plan," carbon emission intensity would need to decrease significantly by about 14% in 2024-2025, or point towards the "15th Five-Year Plan" period, where policies in the ecological and environmental protection field may need to "catch up." In terms of key area reforms, the "Decision of the Central Committee of the Communist Party of China on Further Deepening Reform and Promoting Chinese-style Modernization," passed by the Third Plenary Session of the 20th Party Congress, has deployed over 300 reform tasks, requiring full completion by 2029, which sets a clear reform timetable for the "15th Five-Year Plan." The more than 300 reform tasks cover 15 key areas, including economic system, scientific and technological talent, green transformation, and livelihood security. Among them, market-oriented reforms (such as the construction of a national unified market, the Private Economy Promotion Law, etc.), the cultivation of new productive forces (emerging industries, future industry development, breaking down barriers in the scientific research system, etc.), green low-carbon transformation (non-fossil energy accounting for 25%, carbon emissions per unit of GDP reduced by over 65%), and the improvement of livelihood systems (national coordination of social security, childbirth support systems, etc.) may be key areas for promotion during the "15th Five-Year Plan." The aforementioned key area reforms may not only deepen and expand the reform achievements of the "14th Five-Year Plan" period but also serve as crucial measures to break development bottlenecks and activate endogenous motivation, aiming to provide a solid institutional guarantee for achieving the 2035 long-term goals. The three key words of the "15th Five-Year Plan" are high-quality development deepening, green transformation tackling, and key area reform, which are not isolated but interact and support each other as an organic whole. High-quality development provides a solid material foundation for green transformation and key area reform; green transformation promotes the transformation of economic development methods, creating new growth spaces; key area reform serves as an institutional guarantee for achieving high-quality development and green transformation. The three work together to aim to build a more resilient, sustainable, and inclusive modern economic system, laying a solid foundation for the realization of the 2035 long-term goals. At the same time, the overall layout of the "15th Five-Year Plan" may focus on deepening the new development stage, implementing the new development concept, and constructing a new development pattern. Under the new development stage, the core of the plan emphasizes the resilience and security of economic development, especially the autonomy and controllability of the industrial and supply chains. In the face of external risk shocks, China may need to build an autonomous, controllable, safe, and reliable industrial and supply chain system, reducing dependence on external key technologies and raw materials, and enhancing the resilience and risk resistance of economic development. For example, in the semiconductor field, increasing R&D investment in core links such as chip manufacturing and design, cultivating local leading enterprises, and improving chip self-sufficiency. The implementation of the new development concept will lead high-quality development with the ideas of innovation, coordination, green, openness, and sharing. Innovation is the primary driving force for development, promoting industrial upgrading and improving total factor productivity through technological innovation; Coordinated development focuses on addressing the issues of regional and urban-rural development imbalance; green development requires promoting a comprehensive green transformation of economic and social development, achieving harmony between humans and nature; open development emphasizes expanding foreign openness at a higher level and actively participating in global economic governance; shared development aims to ensure that the fruits of development benefit all people more equitably. At the same time, the construction of the new development pattern will further unleash domestic demand potential, strengthen the main position of the domestic cycle, and promote the mutual reinforcement of domestic and international dual circulation through the expansion of diversified international markets and the promotion of the joint construction of the "Belt and Road" initiative. In the context of China's super-large domestic market, measures such as improving the income distribution system and enhancing social security levels will stimulate residents' consumption potential, while also strengthening domestic infrastructure construction, optimizing industrial layout, and improving the stability and efficiency of domestic supply chains. In terms of international circulation, actively expanding diversified international markets, promoting high-quality development of the "Belt and Road" initiative, participating in the formulation of global trade rules, and enhancing discourse power in global economic governance. Signals from Ministry Projects and Local Meeting Dynamics on the "14th Five-Year" Plan The National Development and Reform Commission, as the planning coordination department, has already released "14th Five-Year" planning research topics in two batches in January and March 2024, providing foundational support for planning compilation. The first batch of topics focuses on the assessment of internal and external environments and foundational research on development, deeply analyzing the complex variables of the international environment during the "14th Five-Year" period. It explores the evolution of the international economic landscape's impact on China's trade and investment, as well as the reshaping logic of industrial ecology due to cutting-edge technology iterations, from the dimensions of global industrial chain and supply chain reconstruction and the evolution of economic and trade rules, combining trends in international order and global governance system changes to analyze the impact of the external environment on China's economic security and development space. At the same time, it focuses inward on the phased characteristics of national development, studying domestic variables such as demographic changes and the artificial intelligence technology revolution, predicting the direction of economic and social structural evolution during the "14th Five-Year" period, and laying a solid cognitive foundation for planning compilation to accurately anchor the development orientation. The second batch of topics focuses on strategic implementation and breakthroughs in key areas, concentrating on practical paths for critical links in national development. Based on research on infrastructure such as transportation and circulation systems, it explores the adaptive logic of hardware support and major productivity layout; in the social welfare sector, it constructs optimization paths for talent cultivation and public service systems around vocational education and healthcare system reform. Research on ecological environment and urban-rural construction connects with the concept of green development, addressing pollution prevention and resource intensification challenges; topics on macroeconomic governance and financial risk prevention and control are designed based on national economic security, creating counter-cyclical adjustment and risk resistance mechanisms. The two batches of topics provide comprehensive research support for the "14th Five-Year" plan; From the perspective of industrial development, the focus is on the digital economy, upgrading the service industry, and cultivating new tracks for industry to explore new drivers of economic growth; it also aims to solidify institutional guarantees through deepening market-oriented reforms, optimizing the fiscal relationship between central and local governments, and promoting the coordinated development of enterprises with different ownerships. Other ministries focus on functional areas and deepen the research on the "14th Five-Year" special planning. The Ministry of Industry and Information Technology (MIIT) focuses on the comprehensive utilization of industrial resources, sorting out the implementation effects of the "13th Five-Year" plan and the development situation of the "14th Five-Year" plan regarding bulk industrial solid waste, waste power batteries, and other renewable resources; the State-owned Assets Supervision and Administration Commission (SASAC) emphasizes the cultivation of emerging industries and tackling key technologies based on the layout of central enterprises, strengthening the strategic support of the state-owned economy through major project planning; the Ministry of Transport focuses on smart transportation and multimodal transport, driving the upgrading of ports and shipping facilities through technological innovation, and shaping a world-class transportation infrastructure system; the National Food and Strategic Reserves Administration and the National Energy Administration anchor food security and energy transition, respectively, conducting in-depth research on resource reserve layout and the development of new energy and energy storage. Each ministry constructs a three-dimensional promotion network for the preparation of the "14th Five-Year" plan through problem-oriented research and task-oriented planning, providing a policy reserve that combines macro guidance and micro implementation for the country's medium- and long-term development. At the same time, local governments and ministries have also started the preparation of the "14th Five-Year" plan intensively, combining their own resource endowments and industrial foundations. On April 10, 2025, the Anhui Provincial Development and Reform Commission held a relevant symposium, emphasizing the enhancement of the strategic and scientific nature of the plan. The next day, the Governor of Hunan Province held discussions with leading manufacturing enterprises and "little giant" enterprises to gather opinions on the "14th Five-Year" plan. Subsequently, Sichuan, Hubei, Guangxi, and other regions also held meetings to address the directives from high-level meetings and local actual conditions, focusing on responding to national strategies, promoting the development of local advantageous industries, driving technological innovation, deepening livelihood guarantees, and improving ecological protection mechanisms, to carry out the preparation work for the "14th Five-Year" plan, leading high-quality development with high-quality planning. Currently, research and meetings related to the "14th Five-Year" plan have been intensively implemented, with key timelines for the "14th Five-Year" plan expected in October 2025 and March 2026. It is anticipated that the Fourth Plenary Session of the 20th Central Committee of the Communist Party of China, to be held in October 2025, will provide feedback and suggestions on the "14th Five-Year" plan; thereafter, from October 2025 to March 2026, the outline of the "14th Five-Year" plan will go through stages such as soliciting opinions, expert reviews, and preliminary examinations before being submitted to the Fourth Session of the 14th National People's Congress for deliberation and approval. At that time, the "14th Five-Year" plan will officially lead China into a new development journey, providing an action guide for achieving the subsequent key "five years." Looking back, as the first five years of comprehensively building a modern socialist country, the "13th Five-Year" period laid a solid foundation for the high-quality development of the Chinese economy with its unique development concepts and policy practices. Its planning no longer uses GDP growth rate as the sole core indicator but shifts to a greater emphasis on development quality, people's well-being, and national security. Looking ahead, the "14th Five-Year" period (2026-2030) may be a critical five years for deepening reforms and overcoming difficulties, likely to take on the historical mission of deepening high-quality development, tackling green transformation, and advancing reforms in key areas The "15th Five-Year Plan" period is not only a deepening of the development ideas from the "14th Five-Year Plan," but also a critical period for laying the foundation to achieve the long-term goals for 2035. During this time, China may inject new momentum into future sustainable development and socialist modernization through a series of in-depth institutional reforms and industrial transformations. Authors of this article: Zhao Wei, Hou Qian Nan, Source: Shenwan Hongyuan Macro, Original title: "Zhao Wei: Review of the '14th Five-Year Plan' and Prospects for the '15th Five-Year Plan' (China Foreign Exchange, August Issue 16)" Risk Warning and Disclaimer The market has risks, and investment requires caution. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial conditions, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Investment based on this is at one's own risk