China on Wednesday began the first of its “Two Sessions” political meetings, a grand political theater during which it will outline its annual growth target and defense budget, as well as its roadmap for the next five years.
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Analysts, however, fear that Beijing will not deviate much from its current path despite the need for reforms.
President Xi Jinping is overseeing a week of political meetings in Beijing’s Great Hall of the People that will effectively approve decisions already made by the Chinese leader and the ruling Communist Party.
China’s 15th Five-Year Plan will be the showpiece of the two-session annual political meeting, which opened on Wednesday with the start of the Chinese People’s Political Consultative Conference, a political advisory body.
Premier Li Qiang will open the second of the two meetings – the National People’s Congress (NPC) – on Thursday, during which he will outline key growth targets for the world’s second-largest economy.
There are pressing issues that need to be addressed, including slow domestic consumption and a declining and aging population.
China’s leaders have promised to “create new demand through new supply and provide strong innovative measures,” but skeptical analysts will be subservient to Xi’s path of prioritizing security and his entrenched power.
The NPC, the national legislature, will also enact laws on child care services, social assistance and health insurance, a spokesperson said at a news conference on Wednesday.
“The goal is to double down on the direction Xi had already set,” said Steve Tsang, director of the SOAS China Institute.
Slow growth
Nowhere is that focus more obvious than in Xi’s signature campaign against corruption, which has targeted the military in recent weeks and toppled some of its highest-ranking generals.
However, analysts will also be watching whether China adjusts its military planning in response to the outbreak of war in the Middle East, following attacks by the United States and Israel against Iran over the weekend.
The conflict “will impact the Two Sessions in several ways,” said Dylan Loh, an associate professor at Singapore’s Nanyang Technological University.
“The Iran crisis will manifest itself more clearly in the foreign minister’s usual press conference. It is anticipated that the developments in Iran and the United States/Israel will be thoroughly aired,” he said.
China’s economy expanded five percent in 2025, in line with Beijing’s goal but one of the slowest in decades.
This year’s target is even lower, between 4.5 and five per cent, and many provinces have lowered their GDP targets in recent weeks.
China’s leaders say the economic model must shift toward growth based on consumption, rather than traditional drivers such as production and exports.
However, the weakened housing market, deflation and youth unemployment have caused consumers to tighten their finances.
Overproduction and international trade tensions have also affected industrial production, and this year’s plan will focus on high-tech manufacturing, the green transition and supply chain resilience.
Beijing has invested billions in robotics and has also seen rapid growth of artificial intelligence startups, fueled by the success of startup DeepSeek.
Geopolitical tensions had also left their mark, even before war broke out in the Middle East with the attacks on Iran.
“China’s growth logic has shifted from pursuing rapid GDP growth at all costs to balancing economic growth with national security, to ensure its supply chains and key industries cannot be easily disrupted by other nations,” said Marina Zhang, associate professor at the University of Technology Sydney.
“A little stagnant”
China also faces serious demographic challenges, as its population is shrinking in successive years.
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Its leaders have promised more help for child care, including subsidies of about $500 a year for each child under three, but those measures have done little to boost births.
Former US defense official Drew Thompson said there is little appetite for innovation when “the overall political objective is security.”
“There are some serious social challenges that the party has to adapt to, and the tools they are using are quite traditional,” Thompson said.
But when “the primary political objective is security… there is no desire to be innovative,” said former US defense official Drew Thompson.
“So they’re kind of stuck.”
(FRANCE 24 with Reuters)
