Economics to play important role during two sessions

While the economy has always been an important topic during the country's annual two sessions meetings, the topic seems even more crucial given the challenging international situation and big changes happening in China.

The slowing global economy, trade tension with the United States, Britain's messy Brexit divorce from the European Union, and rapid technological change and its significance to society are some of the big issues facing the world.

China is also encountering economic headwinds as it works to shift its economy from a low-cost manufacturing model to an innovation-directed, hightech and consumer-driven model.

As if there were not enough already to tackle, important regional changes have also started, such as the coordination in the development of the Beijing-Tianjin-Hebei region - including the creation of the Xiongan New Area to relieve Beijing of its noncapital functions. Others include coordination of the Yangtze River Economic Belt and the newly released blueprint for the Guangdong-Hong Kong-Macao Greater Bay Area.

On Tuesday, Premier Li Keqiang delivered the Government Work Report for the year and set this year's growth target at 6 to 6.5 percent. China's GDP growth of 6.6 percent last year met the target of about 6.5 percent. But with headwinds being felt across the world, growth dropped from 6.8 percent in the first quarter to 6.4 percent in the fourth quarter - the slowest pace since 1990.

Recent government meetings and conferences have provided some clues as to what some of the priorities will be during the two sessions.

Drawing from these, it appears that an important part of the task will be to bolster economic stabilization while curbing risks in the financial sector, such as those from corporate bonds and local government debt. At the same time, the nation's leaders have made it clear that reform and opening-up will move forward.

At the recent Chinese Economists 50 Forum, experts called for stabilizing employment, the financial sector, trade, domestic investment and market confidence, China Daily reported.

One crucial element of reform and opening-up that the 13th National People's Congress will be considering is the draft of a streamlined foreign investment law. It is meant to provide foreign companies with treatment that is equal to that of domestic companies, and clear management of the negative list. A negative list is a list of areas where investment is prohibited; all other areas are presumed to be open.

While the law will undoubtedly help foreign companies coming to do business in China, the idea behind the law is that foreign capital will help China in its structural transition. China's leaders consider it important for the nation's future to continue down the path of modernizing its governmental and business systems and integrating with the world economy.

As Yale University faculty member Stephen Roach said in a recent column published by China Daily, China has benefited greatly from continuing on the road of reform in each regional or world financial crisis in recent decades. Roach, who was formerly chairman of Morgan Stanley Asia, added, "Like comparable circumstances in the past, reforms are the only way out."

This year's two sessions is expected to show a nation working to balance many factors in a highly complicated environment. While new and innovative tools and approaches may be required, China is not likely to deviate from the formula of reform that has proved so successful for many years.