Key takeaways from China's annual NPC parliamentary meeting

China's rubber-stamp parliament concluded its annual meeting on Monday, during which Xi Jinping was confirmed as president for a precedent-breaking third term and installed many of his allies in top government roles.

Here are key takeaways from the nearly nine-day long gathering known as the National People's Congress (NPC):

Continuity, for now

Nearly 3,000 members of the NPC voted unanimously in Beijing's Great Hall of the People for the reinstatement 69-year-old Xi in an election in which there was no other candidate. Xi had already clinched a third term as head of the ruling Communist Party at a congress in October.

Many of the top state roles went to current or former members of the elite Politburo Standing Committee, the party's highest echelon of power.

These include Premier Li Qiang, NPC chairperson Zhao Leji, Executive Vice-Premier Ding Xuexiang, and Vice-President Han Zheng.

But China unexpectedly retained central bank governor Yi Gang and finance minister Liu Kun in their posts, despite both having reached the ministerial-level retirement age of 65.

New premier embraces entrepreneurs

New Premier Li sought to reassure the country's private sector during his media debut.

The former Communist Party chief of Shanghai and close ally of Xi struck a business-friendly tone, promising equal treatment for private and state firms, and that the environment for entrepreneurial businesses will improve.

China's private sector has been rattled in recent years by a sweeping regulatory clampdown targeting some of its most vibrant industries, including the internet and private education.

Conservative growth outlook

Lawmakers endorsed a relatively conservative annual growth target of around 5 percent this year, lower than some analysts' expectations of up to 6 percent.

The closely-watched figure is a barometer of China's economic confidence as it faces multiple headwinds, from worsening relations with the United States and its allies to an uneven domestic economic recovery.

China's gross domestic product (GDP) grew by just 3 percent last year, one of its worst showings in decades, squeezed by three years of Covid-19 restrictions.

Military might and US warning

Xi in a speech on Monday vowed to modernise China's military to make it a "Great Wall of Steel", calling on the country to step up efforts to defend national security amid mounting tensions with the United States. 

He also said that China must achieve greater self-reliance and strength in science and technology, a call that comes as the United States blocks China's access to chip-making equipment and other cutting-edge technologies.

In a closed-door meeting with government advisers last Monday, shortly after the sessions began, Xi said the West, led by the United States, "has implemented all-round containment to suppress China", according to state media.

New financial regulator and govt reforms

China's parliament also approved the biggest government reorganisation since 2018, including the formation of a new financial regulation body, national data bureau, and a revamp of its science and technology ministry, as well as a 5 percent cut to central government staff headcounts.

The new national financial regulatory administration will replace the existing banking and insurance watchdog and oversee all aspects of China's US$57 trillion (RM256 trillion) financial sector apart from the securities market. It will report to the State Council, or the cabinet.

The reform is intended to further consolidate financial regulation under one government body instead of across different institutions.

Some unknowns remain

The full extent of the sweeping government reforms remains unclear, with further details including personnel appointments expected to be released in the coming weeks.

Analysts are watching for the plan to reform Communist Party bodies, expected to be released in the coming weeks. These are likely to carry more weight since many new commissions will be overseeing the new ministries.

A new Central Science and Technology Commission under the Communist Party will be established to oversee the revamped science ministry, according to the government reform plan presented to parliament.

A separate top-level party financial watchdog, the Central Financial Work Commission, is likely to be resurrected after the NPC, sources earlier told Reuters. The sources said it will be headed by a member of the elite seven-member Politburo Standing Committee. This will likely have responsibility for the new state financial regulator.

- Reuters