Why was it highly anticipated? 
China’s Third Plenums, held roughly once every five years, have been pivotal in shaping the country’s economic and political direction. These meetings are often synonymous with significant reform policies that create new business opportunities and are crucial for setting the tone of China’s policy direction. Notable past plenums include the 1978 session that initiated the “Reform and Opening Up” policy, which marked the beginning of China’s transition from a centrally planned economy to a more market-oriented one, spurring economic growth and increased foreign investment.

The July 2024 Plenum focused on pursuing “Chinese-style” modernization, promoting innovation, green energy, and consumption as primary growth drivers. The aim is to integrate real and digital economies, and to inject new production factors into traditional businesses. These initiatives are designed to help China navigate economic risks and headwinds, with structural reform being a priority.

Third Plenum in a nutshell: Key takeaways for businesses
The 2024 Plenum introduced several policy shifts to boost business opportunities and create a more open economy.

International cooperation

• Strategic initiatives: Implement strategic initiatives to cope with intense international competition and adjustments in trade policies to better manage global trade dynamics.
• Risk mitigation: Improve the institutional framework to prevent and mitigate risks.

Financial policy

• Macroeconomic strengthening: Boost consumption and investments by cutting key interest rate benchmarks.
• Open economy: Commitment to build a higher-standard open economy.
• Financial regulation: Enhance financial regulation to prevent systemic risks and improve financial system stability.

Foreign investments

• Industry catalogue expansion: Increase the catalogue of industries to encourage foreign investments and reform of outbound and inbound investment systems. MOFCOM reported an increase of 19.2% year-on-year in new foreign-invested enterprises with 16,805 established in the first four months of the year.
• Access and restrictions: Reduction of items on the negative list for foreign investment access and removal of restrictions on foreign investment in the manufacturing sector.
• Sectoral opening: Broader access in the telecommunications, education, culture, and healthcare sectors.
• Market access: Offer fairer market access by removing restrictions and ensuring equal competition for economic entities of different ownership structures.
• Intellectual property: Strengthen the protection of intellectual property rights to make China more attractive to foreign investors.

What does this mean for Canadian businesses?

The overall tone is positive for foreign companies, including Canadian businesses, looking to invest in China. These new policies have the potential to create numerous opportunities for growth and collaboration. However, the actual impact will depend on how these policies are implemented in practice. While we await the full decisions and formal policies, the next steps involve monitoring how these measures are carried out and assessing the response from Canadian companies operating in China. It will be crucial to assess the response from Canadian companies already operating in China, as well as those looking to enter the market. CCBC will play a key role in keeping its members informed with with regular updates on new policies and their implications. By providing timely information and support, CCBC can assist Canadian businesses in navigating the evolving landscape and capitalizing on emerging opportunities in China.