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Chinese national flags flutter near Tian'anmen Square ahead of China's annual sessions of its top legislature and political advisory body, known as the "Two Sessions," on March 3, 2025, in Beijing.
Viewpoint: China’s annual NPC meeting to address lackluster economy and Trump threat
A sluggish economy and new headwinds created by Donald Trump’s return to the White House will be prominent themes when the nearly 3,000 delegates of China’s National People’s Congress, or NPC, convene in Beijing starting Wednesday. The legislative session will run for about seven days (time not fixed) in parallel with that of the National Committee of the Chinese People’s Political Consultative Conference, or CPPCC. The so-called Two Sessions represent China’s biggest annual political gathering and provide insight into the leadership’s priorities for the year ahead.
We asked Eurasia Group expert Lauren Gloudeman what to watch out for.
What are the NPC and CPPCC?
The NPC is China’s highest governmental organ and national legislature. It usually convenes just once a year to advance legislation and approve national policy plans; the smaller Standing Committee of the National People’s Congress meets more often to continue the body’s legislative work. The CPPCC unites about 2,000 representatives of different social and political groups, giving them the opportunity to make their views known to the country’s leadership. Its role is more symbolic than anything else.
How does the NPC fit into China’s broader governance framework?
On the one hand, you have organs of government such as the NPC and the State Council, which implements legislation passed by the NPC and supervises the bureaucracy. On the other hand, you have the Chinese Communist Party, with its decision-making bodies such as Politburo and the Central Committee. The relationship between the government and the party has changed over time. Xi Jinping – general secretary of the party and president of the Chinese state – has made it a priority to assert the party’s authority over the government. Li Qiang, the party’s No. 2 official is premier of the State Council; Zhao Leji, the party’s No. 3 official, heads the NPC.
Are the Two Sessions’ proceedings open to the public?
The first couple of days will be open-door sessions of public speeches, reports, and press conferences. Li will present his so-called government work report. Like the US president’s state-of-the-union speech, the work report reviews the achievements of the past year and identifies key tasks ahead for the government. It usually sets economic targets. In addition, Xi will give remarks and the Ministry of Finance will give a budget report. Then there will be several days of closed-door sessions, during which not much information will emerge. At the end, different ministries will follow up with press conferences about their plans to advance policies discussed at the NPC.
What do you expect will be the main topics of discussion?
One major topic will be what to do about weak consumer spending, which has been a challenge for years now – especially since the COVID-19 lockdowns, when some people couldn’t leave their homes for months. Nonetheless, we’re not expecting a sea change in the policy approach to stimulating spending. More likely is an expansion of existing trade-in programs that offer subsidies for consumers to trade in their old EVs, household appliances, and other consumer goods for new ones.
What else would you highlight?
On a related note, officials will discuss measures to promote private enterprises. One of the reasons consumer spending is weak is that so many businesses struggled during the pandemic and continue to struggle, which has affected hiring. Authorities aggravated these problems in the private sector with an aggressive regulatory campaign against major companies they thought were insufficiently aligned with the party’s national development strategy. Now they are trying to repair the damage. Xi met last week with the leaders of 20 or 30 companies to reassure them that the government cares about stabilizing the private sector, and the NPC is expected to discuss a so-called private economy law. This measure could, for example, codify into law that private companies have equal rights and status with state-owned companies and offer guarantees of payment for private companies doing business with local governments.
How do you expect tensions with the Trump administration – which has slapped new tariffs on China and threatened more – to play into the NPC discussions?
The NPC is not an event that reacts to or is calibrated around recent events. That said, since Trump took office, we’ve been seeing the party’s high-level talking points acknowledging “external uncertainty” – which is code for Trump-related risks. Its response has been to make it clear to the country that it is committed to increasing support for the domestic economy to boost confidence. I expect these themes to be prominent at the Two Sessions.
Edited by Jonathan House, senior editor at Eurasia Group.
Is President Trump's Russia pivot a win for China?
Is the Trump administration’s rapid shift in diplomatic relations with Russia and push for a ceasefire deal in Ukraine a win for China? On GZERO World, Ian Bremmer asked US Senator Elissa Slotkin for her reaction to the 90-minute phone call between President Trump and Vladimir Putin, a move that upended three years of US-led efforts to isolate Russia from the West diplomatically. Slotkin, a former CIA officer, and Pentagon official warned that China is closely watching how the US handles Ukraine, viewing it as a test of America’s resolve that could have major implications for Taiwan and global stability. The Trump administration has made it clear it doesn’t want to play global peacemaker and that Europe needs to step up to maintain its own defenses. With global power dynamics quickly shifting, will America maintain its leadership role or leave a leadership vacuum for China to fill?
“This is a bigger issue than just Russia-Ukraine. The Chinese are watching everything that’s going on here,” Slotkin says, “They’re watching American staying power. They’re trying to understand if America cares about democracies getting invaded or if they’ll roll over eventually.”
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China's President Xi Jinping attends a meeting in Brazil in November 2024.
Tensions between China and the West heat up amid military exercises
Just days after a Chinese naval helicopter nearly collided with a Philippine patrol plane over a contested reef, China’s military started live-fire drills in waterways near Vietnam on Monday and between Australia and New Zealand over the weekend in an “unprecedented” display of firepower.
Beijing’s democratic critics put up their own show of force. On Sunday, France held military exercises with the Philippines and vowed to deepen their defense ties. On Monday, Japan followed suit, forging a security pact with Manila.
France, which is looking to assert its status as a Pacific power through its overseas island territories across the region, is now negotiating an agreement with the Philippines to allow troops to train on each other’s land, similar to the deal Manila has with the US and Australia.
At a meeting in Manila on Monday, Japanese Defense Minister Gen Nakatani and his Philippine counterpart, Gilberto Teodoro, agreed to work together to counter “unilateral attempts by China and other countries to change the international order and the narrative.”
After Vietnam released new maps marking what Hanoi considers its maritime boundary with Beijing, China on Monday began four days of live-fire military exercises in the Gulf of Tonkin. Vietnam has yet to respond.
Last week, Australia and New Zealand accused China of failing to announce the live-fire component of its military drills in international waters in the Tasman Sea. The abrupt shift in protocol forced commercial airlines to reroute flights last Friday morning. On Sunday, China’s Defense Ministry denied what it called “unreasonable accusations” from Canberra and Wellington.
It’s just the latest tensions between Australia and its largest trading partner. Earlier this month, a Chinese J-16 fighter plane released flares that passed within 100 feet of an Australian P-8 Poseidon surveillance jet flying over the South China Sea.
Where does it all go? Beijing has been trying to seize on the Trump administration’s cuts to international aid and America-first foreign policy to tighten its grip over the Pacific. But China’s early success at promoting economic and diplomatic relations are overshadowed by its “beefs” with most of its neighbors over sovereignty and national security, said Jeremy Chan, a senior analyst at the Eurasia Group.
“China can’t make friends with anybody,” Chan said. “If you zoom out and look at the South China Sea, China basically has a border dispute with almost every country in the Indo-Pacific. That puts a limit on Beijing’s ability to leverage Trump 2.0.”
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Stacked containers in American and Chinese national colors symbolize a trade war between the US and China.
Beijing and Brussels react to Trump tariffs
Of greater interest are nontariff measures, including anti-monopoly investigations launched into Google and the placing of Calvin Klein’s parent company, PVH, on China’s “unreliable entities” list, limiting the brand’s operations there. Beijing also imposed export controls on 25 rare metals, including tungsten, critical for electronics and military equipment.
In the US, consumers might not like Trump’s cancellation of the “de minimis exemption,” which allowed the purchase of goods under $800 without duties. The move is expected to hurt low-income Americans who rely on direct shipping from online vendors while having a minimal impact on Chinese firms. While Trump has said he’s in “no hurry” to talk to President Xi Jinping, we’re watching whether public backlash in the US changes his tune.
Next, the European Union? Trump has put Brussels on his hit list but has not given any dates or specifics. EU trade chief Maros Sefcovic said on Tuesday, "We are ready to engage immediately“ and hoping “to avoid the measures which would bring a lot of disturbance to the most important trade and investment relationship on this planet.”
President Joe Biden meets with China's President Xi Jinping on the sidelines of the APEC Summit in Lima, Peru, on Nov. 16, 2024.
China says no to AI-powered nukes
In a 90-minute meeting on the sidelines of the APEC conference in Lima, Peru, on Saturday, the two world leaders hashed out the agreement after months of reported resistance from China to engage at all in nuclear arms talks.
In a national security memo last month, the Biden administration explicitly prohibited the use of AI to skirt existing protocols around launching nuclear weapons. But China had resisted making a public declaration until now.
The two countries are locked in a race to build up their respective AI capabilities — and that’s deeply intertwined with their military ambitions. The US, which has a technological edge due to having the largest global chip designers and AI software companies, has enacted strict export controls to keep this technology out of China’s hands. With the Trump administration coming to power in January, it’s unclear how Washington’s China policy will change, though it is expected to be similarly aggressive.Sculptures seen on the street before the 31st Asia-Pacific Economic Cooperation Economic Leaders' Meeting on Nov. 12, 2024 in Lima, Peru.
Viewpoint: What to expect from this year’s APEC
Global leaders are descending upon Peru this week for the 2024 Asia-Pacific Economic Cooperation Forum amid an increasingly conflict-ridden world — and just a week after American voters reelected Donald Trump to the US presidency. The year’s meetings are focused on critical economic and environmental challenges, as well as the need to bolster bilateral and multilateral ties in the Asia-Pacific region. With outgoing President Joe Biden meeting up with Chinese President Xi Jinping at APEC, GZERO reached out to Eurasia Group expert Gabriela Vasquez Madueno for her take on what to watch at the event.
What is APEC, and why does it matter?
The Asia-Pacific Economic Cooperation, a forum of 21 economies from across the Pacific Rim focused on promoting sustainable economic growth, trade, and investment in the region, is convening its Leaders’ Meeting this week in Peru. The gathering brings together economies that represent nearly 40% of the world’s population, almost half of global trade, and approximately 60% of global GDP.
While APEC’s formal economic impact remains limited, it is still significant as a platform for diplomatic engagement and bilateral and multilateral cooperation. It provides space for growing economies such as Indonesia and Mexico and major powers like the United States and China to engage and collaborate on issues ranging from climate change and sustainable development to the digital economy.
APEC takes a consensus-based approach, which means all members have an equal voice, and it relies on voluntary commitments and capacity building – rather than treaties – to achieve its goals. So, again, its impact remains limited. APEC, however, is a useful forum to build consensus on topics that may, in the future, become binding commitments in other fora or in trade agreements. It’s also worth noting that APEC is one of few multilateral forums, apart from the WTO, where Taiwan is recognized as a separate economy. This unique status allows Taiwan to participate in global economic discussions and engage with other member economies, including China.
What are the themes for this year’s APEC meetings?
This year’s theme, “People, Business, Prosperity,” focuses on finding innovative solutions to the region’s most pressing challenges. Resilient growth has been a priority. The summit this week aims to promote inclusive and interconnected growth, address the informal economy by utilizing digital platforms for better economic integration, and prioritize resilient growth in the face of global challenges like climate change and food security.
Members are working to facilitate trade and investment in the region by contributing to the development of the Free Trade Area of the Asia-Pacific agenda. They have also defined low-carbon hydrogen policy frameworks to support regional energy transitions and initiatives to prevent and reduce food loss and waste. Participants are putting forward several initiatives to promote sustainable and resilient finance, as well as an exchange of policies aimed at utilizing digital platforms to integrate the informal economy and boost economic integration.
What are the main challenges of APEC?
The recent US election and the pending potential shift in foreign policy under Donald Trump has cast a long shadow on proceedings this week. As such, the US has taken a less active role in the present APEC event, as the next administration will prioritize bilateral discussions over multilateral ones. There will be little room for further integration considering the change of administration, as it is believed the Trump administration will prefer negotiating directly with individual states, rather than working through regional groups. Also, Trump’s threat of tariffs will cause APEC economies to fret.
This future shift creates uncertainties within the forum and potentially undermines its effectiveness in the coming years.
Additionally, the growing geopolitical rivalry between the US and China further complicates discussions and potentially impacts the overall agenda. Other member economies are finding themselves caught in the middle, forced to navigate the competing interests of these two major powers. Beijing, for its part, will use the summit to build its attraction among non-US member countries, some of which are feeling anxious about a Trump presidency, by offering unilateral concessions over tariffs and visas, among other measures.
So this event is a crucial test of the prospects for regional cooperation and global economic stability given today’s geopolitical tensions.
What to watch from this year’s APEC
The 2024 APEC Economic Leaders' Week is hosting several significant bilateral and multilateral meetings. Key leaders, including US President Joe Biden and Chinese President Xi Jinping, are going to be on hand for the event. Biden and Xi are set to meet at APEC, a White House source said Wednesday, and both men will then head to Brazil for the Group of 20 summit.
Xi’s inauguration of the $3.5 billion Chancay port – the largest project China has invested in Latin America in recent years – during his visit to Peru reflects China’s presence in the region. This poses a challenge for the White House in South America, where China's geopolitical influence has continued to grow. Xi, with Trump 2.0 looming, will likely emphasize Beijing’s ability to serve as the region’s free-trade champ, presenting China as a counterweight to the tariff controls being threatened by Trump.
All eyes will be on any potential meetings or informal conversations between US and Taiwanese officials, particularly between US President Joe Biden and high-level representatives from Taiwan, such as the head of TSMC.
In addition to political leaders, several prominent CEOs are in attendance at APEC. These include Jamie Dimon of JPMorgan Chase, Karan Bhatia of Google, and Shou Zi Chew of TikTok. The latter’s presence is particularly interesting given the ongoing risk of being federally banned in the US because of its resistance to selling itself.
We’ll be watching for any major developments or announcements from APEC – and for signs of the forum’s potential strength in the years to come.
Japan’s new PM: What to expect
Ian Bremmer shares his insights on global politics this week on World In :60.
Will there be political fallout in the aftermath of Hurricane Helene?
Lots of fallout for the lives and livelihoods of the people of the Carolinas and elsewhere, but the biggest damage is in both rural areas that largely vote "red" and urban areas that largely vote "blue." And frankly, that's a wash. Horrible morbid pun there, but the reality, I don't think it's going to be much impact come November.
What were the big takeaways from President Xi's speech celebrating the 75th anniversary of the People's Republic of China?
Well, first of all, very interesting. He didn't mention trade war, didn't mention the United States or other potential adversaries on the economic, technological military front by name. Did mention Taiwan, talked about the need to end the separatists and reunify, but nothing new there compared to other statements that he and other leaders have made. I would say the most important thing he talked about are the expectations of serious challenges going forward for the Chinese people. This is coming from a leader who is starting to move towards stimulus as opposed to just sort of incremental responses to economic challenges. A recognition that if they want to hit anywhere close to the 5% plus growth they want, they're going to need to do a lot from the fiscal side as the government. But he's messaging that this is going to be a hard time and it's structural. It's not a matter of a few months, it's a matter of years. And especially with the politics around the world and in the United States not working so well for China right now, that's a message that I think was more for domestic consumption than for international.
Finally, as Japan's new Prime Minister assembles his government, how will he set himself apart from former PM, Kishida?
Well, he's not a "pro-Abenomics" guy. This is someone that I think is going to be challenging from a market perspective. He's going to be fiscally very cautious. He's going to look to raise more revenue, and he's not really loved by the business community. It was the fifth time he tried to become Prime Minister, the former Minister of Defense. Fifth time's the charm apparently in the LDP. I'm not so concerned about potential changes on the international front. He's talked about an "Asian NATO" which is kind of a non-starter from the perspective of the United States. He does want joint control of bases in Okinawa,. That's changed the status quo. But ultimately, if the US pushes back, he'll accept that. The interesting thing about Japan is it's basically a single-party democracy. The Liberal Democratic Party really runs the show. They have an absolute majority in the Diet. They're likely to continue that after snap elections coming up real soon. And so it's really a question of which of the various factions inside that party who largely agree on worldview and on domestic policies ends up running the government. And this time around it is the former Minister of Defense.
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