China economic work conference: how will Beijing combat US trade war impact on 2019 domestic economy?

In December each year, security around the Jingxi Hotel in Beijing increases dramatically, indicating that China’s most important economic policy decision-making event is taking place.

The army-run hotel, 3km west of the Communist Party headquarters of Zhongnanhai, is the regular location for the Central Economic Work Conference (CEWC), which will be attended by the likes of President Xi Jinping, Premier Li Keqiang and Vice-Premier Liu He, as well as financial regulatory officials, economic planners and provincial governors.

Unlike past meetings, this year’s agenda for the meeting which begins on Tuesday will be dominated by the question of how to respond to the rising damage being done to the domestic economy by the trade war with the United States.

There is no easy answer to that question, but the policy priorities that Beijing sets will be closely watched by the Chinese public, who are increasingly concerned about the impact of the trade war on their personal finances and jobs.

“The government needs to prepare for both eventualities [of success and failure of trade negotiations] and set particular stress on domestic stabilisation,” said Tang Jianwei, deputy head of research at the Bank of Communications in China.

5 things to know about China’s Central Economic Work Conference

Ahead of the conference, the country’s top leadership headed by Xi, said on Thursday that China will try to develop “a powerful home market” as a way to offset external uncertainties next year, underscoring Beijing’s determination to minimise the impact from trade tensions on its domestic agenda.

China is still in a “strategic window of opportunity period” and “must firmly focus on getting its own goals accomplished”, according to the summary of a meeting of the Politburo, the country’s supreme ruling body, published by China's state-owned Xinhua News Agency.