Having ushered in 2016, here are some themes that we will hear more about in China in the coming months:
1. Poverty alleviation
“Accurate poverty alleviation” is set to be the buzzword in the new year. The government has named poverty reduction as one of its top priorities for the next five years. President Xi Jinping has already made field trips to Yunnan, Shaanxi, Guizhou and Jilin which have poor GDP rankings in the country.
The Central Urban Work Conference was convened for the first time in 37 years. China is in a crucial transition period from a rural society to an urban one. The process of urbanization led to a range of problems, such as air pollution, traffic congestion, too much garbage and a lack of cultural identity. The conference has set new targets and guidelines for the urbanization work for the coming years.
In the future, efforts will be made to ensure that Chinese cities become more livable, satisfying the demand of the nation’s population.
3. Raising the retirement age
China will roll out a detailed plan by 2017 to raise the retirement age and help the nation cope with a rapidly aging population. A “gradual” hike in retirement age has been outlined in the 13th Five-year Plan. The Ministry of Human Resources and Social Security is studying on detailed measures, which would take into account suggestions and views of different stakeholders.
4. Equity market reform
China’s equity market is set to reflect the nation’s economic “new normal” and deepening reforms. Beijing has stressed that one of its key tasks in 2016 is developing the capital markets further.
The Central Economic Work Conference has noted that the nation would accelerate financial reforms in order to optimize the fund-raising function while also serving investors better.
On top of this, the State Council meeting on December 23 highlighted the significance of building a multi-layer capital market including equity and debt, and strengthening government supervision and risk controls. The A-share markets will witness more reforms this year.
5. Air pollution
Air pollution problem has become more acute in China. A new law on Prevention and Control of Atmospheric Pollution, which was passed on August 29, 2015, took effect on January 1.
The amendments grant the state new powers to punish offenders harshly and create a legal framework to cap air pollution. Also, the new law has proposed the establishment of regional joint mechanisms to prevent and control air pollutants in certain areas.
Beijing-Tianjin-Hebei has set a target to cap their PM2.5 level within 73 micrograms per cubic meter by 2017, according to a joint environmental protection plan released at the end of December.
6. Second-child policy
China’s second-child policy took effect on January 1. It’s possible that the country will witness a baby boom in September and October this year. Nearly half of parents who plan to have a second child are now in their 40s.
7. Social security
China has passed controversial new anti-terrorism laws in a bid to combat growing threats. The laws create a new anti-terror agency and security forces with significant powers. Authorities will establish a single counter-terrorism body which will be in charge of “identifying terrorist activities and personnel and coordinate nationwide anti-terrorist work”.
8. Anti-corruption fight
The new leadership has intensified the fight against corruption over last three years. President Xi said in a meeting of the Communist Party’s Central Commission for Discipline Inspection that authorities will not relax or slow the ant-graft campaign in 2016.
9. Housing market
There have been doubts whether the government will maintain a loose credit policy for the housing sector this year. But the market outlook appears to be positive. The government is likely to roll out more stimulus measures this year.
10. New residence permit system
On December 12, the State Council unveiled an interim regulation on residence permit system, which would ensure access to basic public services for migrants and encourage local governments to provide better services.
The new rules, which took effect on January 1, will enable migrants to access six basic public services like employment and social security if they have stayed in a city for more than six months.
This article appeared in the Hong Kong Economic Journal on Jan. 4.
Translation by Julie Zhu
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