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In China, one of the most important policy meetings in years started today. It's what the ruling Communist Party calls third plenum, and it can be a little difficult to understand. NPR's John Ruwitch explains what's at stake.
JOHN RUWITCH, BYLINE: Every five years, China's ruling Communist Party picks a new Central Committee. It's the party's top policymaking body, and it meets a few times over the course of the term in secret at a guarded military hotel in Beijing. That's what's happening from Monday to Thursday this week. It's the third meeting of the current Central Committee or the third plenum, for short.
JUDE BLANCHETTE: This is a very rare time when, you know, the full power of the Communist Party convenes.
RUWITCH: Jude Blanchette is an expert on Chinese politics at the Center for Strategic and International Studies in Washington.
BLANCHETTE: And so the message coming out of this is critical for aligning the entire political economic system.
RUWITCH: All plenums matter, but third plenums have sometimes reshaped the economy. The biggest was in 1978.
(SOUNDBITE OF ARCHIVED RECORDING)
DENG XIAOPING: (Non-English language spoken).
RUWITCH: At that meeting, paramount leader Deng Xiaoping formally launched China's reform and opening drive.
(SOUNDBITE OF ARCHIVED RECORDING)
DENG: (Non-English language spoken).
RUWITCH: In 1993, a third plenum accelerated state-owned enterprise reform. And the first third planum, under current leader Xi Jinping back in 2013, called for sweeping market reforms. Those plans never panned out, and the world has changed a lot since then. Geopolitics is forcing Chinese leaders to rethink their economic policies. At home, growth is slow, and confidence is low.
UNIDENTIFIED PERSON: (Non-English language spoken).
UNIDENTIFIED STORE OWNER: (Non-English language spoken).
UNIDENTIFIED PERSON: (Non-English language spoken).
RUWITCH: That's apparent in a small Beijing liquor store. People come and go, occasionally buying small items, but the owner tells NPR nobody is buying Kweichow Moutai these days. That's China's most famous liquor.
UNIDENTIFIED STORE OWNER: (Speaking Mandarin).
RUWITCH: She says the price of a bottle has dropped, falling over 10% since the spring.
ROBIN XING: The biggest challenge for China is deflation. And to decisively reflate the economy, they need a much bigger stimulus package.
RUWITCH: Robin Xing is a China economist at Morgan Stanley in Hong Kong.
XING: I do think the third plenum will include certain reforms to support consumption, including broadening the social welfare coverage. But we need something quick.
RUWITCH: He doesn't think the plenum will deliver that. State-controlled news outlets have offered some clues about what may be coming. One thing we know is what the title will be on the plenum's final report. Senior party leaders vetted a draft, and it's a mouthful - Decisions of the Central Committee of the Communist Party of China on Further Comprehensively Deepening Reform and Advancing Chinese Modernization.
Manoj Kewalramani follows this stuff closely. He publishes a newsletter translating and summarizing articles from the People's Daily, the party's mouthpiece newspaper. He's not expecting big surprises.
MANOJ KEWALRAMANI: I think you will see a reaffirmation of the fact that the Communist Party, as opposed to the state or private institutions or whoever else, remains the primary actor that must be in charge of directing economic policy.
RUWITCH: That means a focus on Xi Jinping's priorities, like security as a prerequisite for economic growth and development of, quote, "new quality productive forces" - essentially, technologies and industries that will be important in the future. Rather than concrete demand-side reforms and stimulus, Kewalramani expects an emphasis on strengthening China's production base, girding for the long-haul in the face of a challenging external environment.
KEWALRAMANI: There is an anxiety around hollowing out of manufacturing...
RUWITCH: Party leaders seem likely to call for more openness to foreign capital and trade too. China could use it. But Kewalramani and others say it's hard to see the party committing to much on that front this week, given the rise in geopolitical tensions.
John Ruwitch, NPR News, Beijing.
(SOUNDBITE OF J COLE SONG, "FORBIDDEN FRUIT") Transcript provided by NPR, Copyright NPR.
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