ExplainerWhy postponing China’s National People’s Congress adds further complexity to Beijing’s economic plan

The annual National People’s Congress will be delayed until at least the end of March or even early April due to the coronavirus outbreak

The annual parliamentary gathering is a ceremonial event to rubber-stamp policies that have already been decided, but the outbreak has changed the landscape

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Beijing’s practice of setting targets and top-down approach, a legacy from the command economy days, is again under pressure with the National People’s Congress set to be delayed until at least the end of March or even early April. Photo: EPA

Published: 9:30am, 20 Feb 2020Updated: 1:18pm, 12 May 2020

The forced postponement of China’s annual parliamentary gathering due to the coronavirus outbreak has added fresh uncertainty and complexity to Beijing’s management of the world’s second largest economy, reflecting inherent contradiction between a top-down policymaking system and a rapidly changing world.

Beijing’s practice of setting targets and top-down approach, a legacy from the command economy days, is again under pressure with the National People’s Congress to be delayed until at least the end of March or even early April.

This raises questions over how China can reconcile goals made at December’s Central Economic Work Conference, which are usually then released during Premier Li Keqiang’s government work report at the National People’s Congress, with the reality of a much-changed environment due to the deadly coronavirus outbreak which escalated at the end of January.

While the annual parliamentary gathering is seen as a ceremonial event to rubber-stamp policies that have already been decided, it is officially the supreme power body in China and the visible end of a long and opaque policy decision making chain.

It is the venue to explain the ruling Communist Party’s decisions to the public and to publish Beijing’s targets for economic growth, unemployment and inflation as well as the fiscal deficits – all of which were decided weeks or even months earlier at close-door meetings but remained unpublished.

President Xi Jinping has said on several different occasions over the last two weeks that China will stick to its economic and social development goals for 2020 as the impact of coronavirus, which has killed over 2,000 people in China and seriously disrupted services and production, would be short-lived.

In a telephone call with French President Emmanuel Macron, Xi reiterated the message that the impact of the coronavirus, which causes the disease officially known as Covid-19, on China's economy will be “temporary” and that China “will still be able to achieve this year's set goals for economic and social development”, Xinhua reported.

While Xi is putting faith in the broad policy direction set at the Central Economic Work Conference in December and the grand vision of building up a comprehensive well-off society by 2020, analysts have said the Chinese authority should be flexible in adjusting its specific economic policies and goals in response to the outbreak.