On Monday, People’s Daily published an editorial on the New Development Concept (NDC) by Han Wenxiu, Vice Premier Liu He’s right-hand man on econ policy.
Han’s argument: Economic security is an inherent part of the NDC.
Some context: The NDC was first fleshed out by Xi Jinping in 2015, as an overall approach to economic development. It consists of five components:
- Innovative development
- Coordinated development
- Green development
- Open development
- Shared development
Han is stretching the definition to add “secure development” to that list (People’s Daily):
- “Security is the...inherent requirement of the NDC.”
More context: National security – including economic security – emerged as a major policy priority from December’s Politburo meeting (see December 14 Tip Sheet).
- Since then, policy wonks have been formulating plans to secure key sectors of China’s economy from foreign and domestic risks.
Han argued that the emphasis on security won’t affect China’s economic opening:
- “We must adhere to the...policy of opening to the outside world...and coordinate between opening up and security.”
Get smart: Beijing genuinely wants to strike a balance between security and opening up.
- That said, risk-averse Chinese officialdom often comes down heavily on the side of security.
The bottom line: Risks to foreign companies are rising.