The Third Plenary Session of the 20th Central Committee of the Communist Party of China (CPC Central Committee) has attracted much attention, particularly with the adoption of the Resolution of the CPC Central Committee on Further Deepening Reform Comprehensively to Advance Chinese Modernization. The Resolution indicates the future direction of China’s development and will have a significant impact on Hong Kong.
Traditionally, the session should have been held in the autumn of 2023. However, it was only convened in July this year, almost a year later than usual. The delay was due to a change in the backdrop against which the sessions occurred. China is now at a new historical juncture marked by significant domestic and external changes.
The Mainland economy is transforming from a traditional investment- and property-driven model to an innovation and technology-driven one. However, transitioning from old to new growth drivers is easier said than done.
The world is currently experiencing significant changes unseen in a century. While about 1.05 billion people in the world, mainly in developed countries such as members of the Five Eyes Alliance (the U.S., the U.K., Canada, Australia, New Zealand), the European Union and Japan, have achieved modernization since the Industrial Revolution, China alone is in the process of modernizing over 1.4 billion people, more than the total number having achieved modernization over the past three centuries. This has brought significant changes to the global landscape, prompting the U.S. to position China as a comprehensive strategic competitor. China’s overseas development and cooperation have undergone fundamental changes in the past few decades.
Given these extraordinary times characterized by domestic and external changes, the strategic significance of convening the third plenary session to chart the future course of development cannot be overstated.
The Resolution, consisting of 15 parts in three major sections, has made systematic plans for comprehensively deepening reform in 14 areas. Regarding the six chapters concerning economic development, there are notable details worth mentioning.
First, the Resolution has emphasized support for developing the private economy through measures such as formulating a private sector promotion law and supporting capable private enterprises in leading major national technology initiatives, reflecting the growing importance of private enterprises.
Second, the Resolution will enhance the protection of intellectual property rights, stipulating that all economic entities, regardless of their ownership, shall be treated as equals in terms of liability, offence, and penalty in case of an infringement of property rights and legal interests.
Third, it aims to deepen the reform of the financial system by formulating a financial law, promoting renminbi internationalization, and developing offshore renminbi markets, among other measures.
Hong Kong is also mentioned in a chapter titled “Pursuing High-Standard Opening Up.” In addition to frequently cited efforts to harness the institutional strengths of “One Country, Two Systems,” as well as consolidate and enhance Hong Kong’s status as an international financial, shipping and trade centre, the Resolution also stressed that the city would play a unique and crucial role in drawing highly skilled professionals from around the globe and in the nation’s opening-up.
In attracting international high-calibre talent, what the country values most is top talent in the technology sector, with the aim of serving the national strategy of scientific and technological self-reliance and self-strengthening. As such, Hong Kong should plan ahead and act proactively towards this strategic direction.
Hong Kong should also continue to support the national strategy of pursuing a high-standard opening up. Considering the current challenges in U.S.-Sino relations, it is important for Hong Kong to take an active role in welcoming foreign investment and assisting Mainland businesses in their efforts to expand globally.
Dr. Fang Zhou, JP, Research Director, One Country Two Systems Research Institute