At 4th Plenum, China Unveils 15th Five-Year Plan to Push for ‘Innovative and Inclusive Development’
China’s 4th Plenum
On 20 October 2025, the Communist Party of China (CPC) held its 4th Plenary Session with the 15th Five-Year Plan (#FYP) for Economic and Social Development as one of the key items on the agenda. The Fourth Plenum is scheduled to take place in Beijing from 20 to 23 October 2025 and usually some key cadre changes are also officially announced.
It is worth recalling that the 3rd Plenum, which was supposed to be held last year, did not take place. Moreover, the Five-Year Plan is usually discussed at the 5th Plenum but observers note that the current trade tensions may be cause for preponing the discussions. Arriving toward the end of the 20th CPC Central Committee and the 14th Five-Year Plan, the 4th Plenum will take stock of the previous Plan and indicate the key socio-economic orientations for the five-year period from 2026 to 2030.
Facing Challenges
In the current trade war between China and USA, China must tread carefully to ensure growth despite tough challenges. The latest economic data released showed that the Chinese grew by 5.2% during the first three quarters on 2025 compared to the corresponding period in 2024.
China also faces a number of internal challenges. Firstly, its housing market has plummeted, causing its citizens to ‘feel poor’ and ‘afraid to spend’. Secondly, the provincial and municipal governments which counted mostly on the auction of land to developers as a source of income now face difficulty to balance their budget and are strapped by a heavy debt burden.
The other key challenge is the ageing population and its attractiviy as the world’s largest market will start to lose its shine. In 2025, India has surpassed China as the world’s largest country by population, and by 2050, one in four person in the world will be African.
Redress Housing Sector and Manage Local Government Debt
The Government of China proposes to acquire the apartments around China that cannot find buyers. Some housing projects have even been interrupted due to lack of interest. The Government thus plans to complete or repackage these apartments as ‘Social Housing’ in order to make them accessible to the lower rungs of the society.
The Central Government will give due consideration to Local Governments to manage their debt burden by providing appropriate considerations in view of the challenges in the current environment. Local Governments are encouraged to develop new revenue sources and to encourage provincial-level enterprises to ‘Go Overseas’ to find new markets and growth space.
Expand Social Services
China is considering to expand social services such as medical aid and pension to better share the fruits of development. The objective is to boost consumerism as part of the dual-circulation policy proposed earlier. Recently, China launched the ‘Swap Old with New’ backed by government subsidies to encourage consumers to upgrade their cars, home appliances and electronics in a bid to boost internal consumption, but it would appear that there is room for improvement.
As the Chinese population ages and labor costs rise, some Chinese enterprises have delocalized abroad. Locally, Chinese factories are accelerating the adoption of robotics and AI to automate production.
In the recent past, the Government has loosened rules about birth control, but the policy has yet to reverse the decline in fertility rate. Additionally, the Government has started to experiment with relaxing visa rules for foreigners wishing to work in China.
Foster Innovative Development
The trade war between China and USA has exposed vulnerabilities on both sides. For China, the need to innovate and become self-reliant in the field of semiconductor and soflware has become acutely apparent. Therefore, the 15th Five-Year Plan will promote ‘New High-Quality Development’ and the emergence of an indigeneous semiconductor and software ecosystem.
Previous key sectors mentioned in previous Five-Year Plan and #MadeInChina2025 will continue to be supported. Thus, China will maintain its lead in EV, PV, Shipbuilding, High-Speed Train, Drones, and #RareEarths, to name a few. New emerging sectors such as Biotech, #AI, Robotics, Quantum Computing, Civil Aviation, Space Technology and Deep Sea mining will be promoted.
Maintain Steady Course in Turbulent Sea
In terms of cross-cutting themes, the 15th Five-Year Plan will continue to reinforce #FoodSecurity, #EnergySecurity while promoting the #EnergyTransition to green. Futhermore, China plans to uplift more people into the middle-class category as part of its Shared Common Prosperity program and to render its development more inclusive.
Likening the Chinese economy to a ship in a storm, the Government aspires to maintain a steady course in a turbulent sea. In quantitative terms, China contributed to nearly one-third of the global economic growth and plans to remain the ‘locomotive of the world’s economy’. It is expected that the 15th FYP will be ratified in March 2026.