Beijing, China, Oct. 23, 2025 (GLOBE NEWSWIRE) -- In 2023, General Secretary of the Communist Party of China (CPC) Central Committee Xi Jinping first proposed the concept of new quality productive forces during a local inspection tour. Since then, he has made important statements and arrangements regarding leveraging local conditions to develop new quality productive forces on a series of important occasions.
In Volume V of Xi Jinping: The Governance of China, a chapter is dedicated to "New Quality Productive Forces for High-Quality Development." This chapter includes Xi’s speech at the 11th group study session of the Political Bureau of the 20th CPC Central Committee, in which he emphasized new quality productive forces as “a primary driver of high-quality development.” In excerpts from Xi's speeches made between March and December 2024 on leveraging local conditions to develop new quality productive forces, he stressed that “we should focus on the primary goal of high-quality development and leverage local conditions to develop new quality productive forces.”
The fourth plenary session of the 20th CPC Central Committee will be held in Beijing from October 20 to 23. It will review the opinions solicited from in and outside the CPC on the CPC Central Committee's proposals for formulating the 15th Five-Year Plan (2026-30), drawing up a blueprint for China's development in the next five years, according to the Xinhua News Agency.
On April 30, when presiding over a symposium on China's economic and social development in the 15th Five-Year Plan period in Shanghai, Xi said higher strategic priority must be given to fostering new quality productive forces in line with local conditions in the next five years. Highlighting the roles of technological innovation and the real economy, he urged efforts to transform and upgrade traditional industries, develop emerging industries, and make forward-thinking arrangements for industries of the future, so as to accelerate modernization of the industrial system.
In the 14th installment of the special series "Decoding the Book of Xi Jinping: The Governance of China," the Global Times (GT), along with People's Daily Overseas Edition, continues to invite Chinese and foreign scholars, translators of Xi's works, practitioners with firsthand experience and international readers to discuss the theme of "new quality productive forces for high-quality development" and deeply explore the important practical significance and value of this concept.
In the 12th article of the "Scholars' Perspectives" column, Global Times talked to Justin Yifu Lin (Lin), dean of the Institute of New Structural Economics at Peking University. Lin was former chief economist and senior vice president of the World Bank.
GT: President Xi Jinping places great emphasis on fostering new quality productive forces. In Volume V of Xi Jinping: The Governance of China, he stressed that "developing new quality productive forces is essential to high-quality development, and also a primary driver,” adding that “technological innovation acts as a core factor in developing new quality productive forces, as it gives rise to new industries, business models, and growth drivers.” How do you evaluate China’s progress in technological innovation in recent years, and what are the future trends?
Lin: While lagging behind in many industries in the past – some of which took a long time to catch up, such as the automotive sector – we are now leading the world in new-energy vehicles (NEVs). In industries tied to the Fourth Industrial Revolution, such as artificial intelligence (AI) [large language models], we’ve made significant breakthroughs since late last year, benefiting both China and the world.
I think the rise of Chinese high-tech firms is inevitable. During the catch-up phase, we benefit from the advantages of being a latecomer, achieving technological innovation and industrial upgrading through the low-cost, low-risk approach of importing, digesting, and absorbing foreign advancements. This has been crucial for economic growth, though it rarely grabs widespread attention.
Now, breakthroughs in the Fourth Industrial Revolution stem from two key factors: first, the rapid economic growth since the reform and opening-up period began, which has bolstered human capital, social capital, and infrastructure; second, sustained investment in education and technology over the years. Together, these represent a case of years of accumulation are now yielding results.
Thus, we can confidently expect that in the future, China will lead the world in more domains of the Fourth Industrial Revolution.
GT: In Volume V of Xi Jinping: The Governance of China, President Xi emphasized, “We should focus on the primary goal of high-quality development and leverage local conditions to develop new quality productive forces.” (P241) He noted that “you must not restrict your efforts solely to the ‘new trio’ of new energy vehicles, lithium-ion batteries, and photovoltaic products, nor should you rush into one particular industry and create a frenzy of interest that dissipates just as quickly.” (P242-243) Why is it so important to emphasize “local conditions” when fostering new quality productive forces? How can this help advance Chinese modernization?
Lin: Looking at long-term economic growth, the most crucial factor is continuously improving productivity levels. How do we make that happen? The most important task is to drive continuous technological innovation in existing industries and ensure the constant emergence of new, higher value-added sectors – with the core lying in the sustained development of new quality productive forces.
The report to the 20th National Congress of the Communist Party of China (CPC) emphasizes that “to build a modern socialist country in all respects, we must, first and foremost, pursue high-quality development,” which requires new theoretical guidance. In keeping with long-range objectives through 2035 proposed by President Xi in 2020, our target is to double the country’s GDP and the per capita disposable income from 2020 levels by 2035. This amounts to essentially recreating a 100-trillion-yuan economy, which demands an average annual growth rate of 4.73 percent over those 15 years.
In this new era, to meet the requirements of high-quality growth – guided by the new development philosophy while building a new development pattern – we need to accelerate the creation of new quality structures in endowments, production, infrastructure, superstructure, and education and research. By combining an effective market with a well-functioning government, and by tapping into our evolving comparative advantages to push forward structural upgrades, we can deliver the quickest gains in productivity. That will drive both qualitative and quantitative growth in the economy, helping us basically realize socialist modernization from 2020 through 2035.
Developing new quality productive forces must leverage local conditions, or it could lead to unintended effects. In this new stage, China's material endowments have advanced dramatically: Capital shortages have eased, infrastructure is solid, industrial technologies have built up, ecosystems have been restored, human capital has surged, and a massive domestic market has taken shape. We should fully leverage each region's comparative advantages in land, labor, and capital to cultivate new quality productive forces, with special emphasis on green ones.
For the first time, the third plenary session of the 20th CPC Central Committee included measures for developing "new quality productive forces" into a major central policy document, laying essential groundwork for deepening institutional reforms while tapping into the opportunities of the Fourth Industrial Revolution. Fully and effectively implementing the plenum’s directives will provide a firm material base for advancing Chinese modernization through high quality development and ultimately realizing the great rejuvenation of the Chinese nation.
GT: You mentioned the need to "fully leverage comparative advantages in developing new quality productive forces." Could you elaborate on how to apply such an approach under the current new circumstances?
Lin: Whether in emerging or traditional industries, China enjoys strong opportunities to advance new quality productive forces. However, there must be no headlong rush into these sectors. How can we avoid that? The key is to “leverage local conditions.” Broadly speaking, it means taking into account each area's resource endowments and existing industrial base, acting in line with local realities, and playing to comparative strengths – pursuing emerging industries where they fit, or focusing on upgrading traditional ones where that's the better path.
With this new tech revolution reshaping industrial chains, we have to seize the moment to ramp up innovation, foster emerging industries, and plan future industries in advance. Meanwhile, this does not mean neglecting or abandoning traditional industries. We should avoid one-size-fits-all approaches. Local governments should base their work on reality and establish the new before abolishing the old. They need to selectively promote new industries, new business models, and new growth drivers while providing differentiated guidance, based on local resources, industrial foundations, and research capabilities. Meanwhile, localities should also leverage new technologies to transform and upgrade traditional industries, and push for their high-end, intelligent and green development, so that they become carriers of new quality productive forces.
The ongoing Fourth Industrial Revolution has given rise to emerging industries such as NEVs, AI, robotics, drones, and genetic engineering, while future industries like quantum communication and nuclear fusion are moving toward commercialization. For emerging sectors with short R&D cycles, China’s more developed regions enjoy advantages in capital, talent, and industrial ecosystems. With an effective market and a well-functioning government, they can foster a dynamic environment for firms to seize opportunities in the technological revolution, develop new industries, and plan ahead for future ones. Meanwhile, the central and western regions should also leverage technological advances and industrial relocation to cultivate industries aligned with their resource endowments and comparative advantages.
GT: President Xi stressed that “higher strategic priority must be given to fostering new quality productive forces in line with local conditions in the next five years” at a symposium on April 30, 2025 on China's economic and social development in the 15th Five-Year Plan period (2026-30). What new trends do you see in these sectors’ growth over the next five years? Compared with the traditional Western path, how can the principle of “leveraging local conditions” offer developing nations a new model for modernization and global economic governance?
Lin: In emerging industries, those that have already taken shape during the 14th Five-Year Plan period (2021-25), such as NEVs, the low-altitude economy, robotics, high-end medical equipment, industrial software, brain-computer interfaces, photonic chips, and the metaverse, are thriving and have entered the world’s top ranks, with some even leading globally. Meanwhile, a number of sectors that were considered future industries during the period, including controlled nuclear fusion, quantum computers, quantum chips, intelligent manufacturing, and biomanufacturing, are set to achieve technological breakthroughs, move into mass production, and become the next wave of emerging industries.
As for traditional industries, which were the products of the Second and Third Industrial Revolutions, China will see more of them transformed through digital, intelligent, and green transformations. Many sectors that are still catching up, like the automobile industry during the 14th Five-Year Plan period, may overtake global competitors by “changing growth lanes,” emerging as new leaders in their fields.
After World War II, many developing countries broke free from colonial and semi-colonial rule and, seeking modernization under the leadership of their national governments, aiming to catch up with advanced economies. Industrialization has long been recognized as the foundation of modernization, yet despite decades of effort, most developing countries remain trapped in low- or middle-income status, with their gap from developed nations widening instead of narrowing. The main reason lies in their attempts to replicate the industries of advanced economies – those intensive in capital and technology – while overlooking their own reality as economies relatively rich in labor or natural resources but short on capital. Failing to leverage their specific conditions and build on their comparative advantages, some nations tend to “pit their own weaknesses against others’ strengths,” resulting in repeated setbacks.
President Xi’s vision of “leveraging local conditions to develop new quality productive forces” offers developing nations a new path to successful industrialization and modernization, one that enables them to grow in line with their resource endowments and industrial foundations, achieve prosperity through mutually beneficial globalization, and contribute to a new system of economic governance. It also provides vital theoretical guidance for building a community with a shared future for mankind based on common prosperity.
GT: In recent years, the US government has repeatedly resorted to tariffs and a range of other restrictive measures against China. To what extent do you think these measures exert pressure on China’s economic development? Will they alter China’s long-term development trajectory? How can developing new quality productive forces by leveraging local conditions enhance China’s economic resilience against external pressures?
Lin: Ultimately, the key to economic development lies in doing our own job well. A favorable external environment is certainly welcome, but even without it, there is no cause for pessimism. China is a large economy driven primarily by its domestic circulation, with over 85 percent of its production occurring within the domestic market. This is like the difference between an aircraft carrier and a small boat: when the international environment turns rough, small economies may face severe turbulence or even crises, but for a large economy like China, as long as we stay focused on our own work, we can continue to forge ahead through both calm and stormy seas, steadfastly advancing high-quality development and moving steadily toward our long-term goals.
At present, China is undergoing profound changes unseen in a century. As the global landscape evolves, external pressure and containment may intensify, while short-term structural adjustments at home could bring temporary fluctuations. Yet overall, development remains the foundation and key to solving all problems. In the short term, China has sufficient policy space to keep the economy stable and on a positive trajectory. In the long run, the real driver of sustained growth lies in developing new quality productive forces.
As long as we leverage the joint strength of an effective market and a well-functioning government to fully tap China’s advantages in developing new quality productive forces across both emerging and traditional industries, the Chinese economy will be able to maintain steady medium-to-high growth, demonstrate lasting resilience in the face of external pressures, and ultimately achieve the second centenary goal.
Source: Global Times:
Company: Global Times
Contact Person: Anna Li
Email: editor@globaltimes.com.cn
Website: https://globaltimes.cn
City: Beijing
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