Linchpin of progress

Since the launch of the first Five-Year Plan in 1953, China's GDP has grown at an average annual rate of 7.9 percent, fueling all-around progress across economic, political, cultural, social and ecological domains.

This journey has transformed China from a country of extreme poverty into a nation with a per capita income exceeding $13,000, a manufacturing sector that accounts for nearly 30 percent of the global value-added output and a level of comprehensive national strength ranking among the world's most advanced. As President Xi Jinping has stated, the scientific formulation and consistent implementation of the five-year plans constituted an important experience of the Communist Party of China in governing the country, and a vital political advantage of socialism with Chinese characteristics.

During the first five five-year plans, China established an independent and relatively complete industrial and national economic system. In the subsequent plans to the 13th, it achieved its first centenary goal of building a moderately prosperous society in all respects. The five-year plans have thus proven to be a strategic instrument for steering the nation's direction, propelling growth and shaping its development paradigm.

The five-year plans were distinguished by their long-term vision, adaptive incrementalism and sustained implementation, with specific targets dynamically refined to keep pace with the times. Each plan typically incorporated a mix of carried-over, adjusted and newly introduced objectives, with most revisions being incremental rather than fundamental.

For instance, the Recommendations of the 20th CPC Central Committee for Formulating the 15th Five-Year Plan (2026-30) for National Economic and Social Development built on the previous plan's focus on high-quality development, while introducing new emphases such as achieving higher-quality economic growth alongside an appropriate increase in economic output. It also proposed advancing the development of a unified national market, with a dedicated section that calls for eliminating bottlenecks and obstacles hindering the market's development.

The formulation of five-year plans combines top-level design with broad public participation. Starting with the 14th Five-Year Plan (2021-25), China introduced online public consultations during the drafting of recommendations for the plan. For the 15th Five-Year Plan, this process was launched nearly three months earlier, accumulating over 3.11 million public submissions.

To ensure the effective execution of its five-year plans, China has established a structured system that begins during the pre-implementation phase, with the issuance of detailed task allocation plans to relevant government agencies. Once the implementation is underway, phased dynamic monitoring, mid-term evaluations and final assessments are conducted systematically. Binding targets are integrated into broader socioeconomic evaluations and performance metrics, while major projects are advanced through countdown schedules and progress-tracking mechanisms. Throughout the entire cycle, supervision and audit bodies provide oversight to ensure compliance with the plan's strategic objectives.

This end-to-end approach has enabled China to achieve successive developmental milestones. Despite pandemic disruptions and external uncertainties, the 14th Five-Year Plan successfully accomplished its overarching goals: Eight key indicators outperformed expectations; 17 major strategic tasks saw substantial progress; and a total of 102 significant projects alongside over 5,000 sub-initiatives were fully implemented. In a demonstration of its commitment to carbon peak and neutrality goals, China reduced its energy consumption per unit of GDP by 11.6 percent in the first four years of the 14th Five-Year Plan period, equivalent to cutting carbon dioxide emissions by approximately 1.1 billion metric tons.

Nobel laureate economist Robert Engle noted in 2011: "While China is making five-year plans for the next generation, Americans are planning only for the next election." This contrast underscored the stability and executive strength of China's governance model.

The five-year plans function as a visible hand in optimizing resource allocation. The core mandate is to articulate national strategic intent, define governmental priorities and guide the conduct of market entities. In coordination with the market's invisible hand, the five-year plans fulfill three essential roles. They direct public resource allocation by defining the types, volumes and sequencing of public goods provision, thereby raising distribution efficiency; they orient nongovernmental resources toward strategically prioritized fields, fostering synergistic progress; and they act as a signaling mechanism for policy stability, offering clarity to businesses and other actors in their long-term planning while ensuring a predictable policy environment.

In practice, China has successfully harmonized the micro-rationality of market mechanisms with the macro-rationality of strategic planning. Guided by the principle of "focusing on long-term vision while delivering on near-term implementation", the five-year plans are coherently linked to the Long-Range Objectives Through 2035, enabling proactive layout of strategic emerging industries and fundamental infrastructure.

The planning framework has been instrumental in building integrated national infrastructure networks and fostering regionally balanced growth. During the 14th Five-Year Plan period, China accelerated the development of its multidimensional transport network with remarkable outcomes. The "eight-vertical and eight-horizontal" high-speed railway network reached nearly 50,000 kilometers in operation; the expressway network surpassed 190,000 km; and ultrahigh voltage electricity transmission lines exceeded 50,000 km in total length. Together, these accomplishments reflect China's strong capability in orchestrating large-scale projects and achieving breakthroughs in critical technologies.

The five-year plans act as a strategic cornerstone in China's macroeconomic governance framework. The country has developed a coherent national planning architecture that integrates three administrative tiers — from national to county level — with four categories of plans: the five-year plan as the top-level blueprint, spatial plans as the territorial base, and specialized and regional plans as supporting instruments. This system ensures coordination across fiscal, monetary, industrial and land-use policies.

Through trans-cyclic design and counter-cyclic adjustments, the five-year plans build a robust policy reserve that supports macroeconomic regulation. This allows the government to accelerate prearranged measures in response to changing conditions. A case in point was the rollout of a targeted package of incremental measures in the second and third quarters of 2024, which effectively integrated with existing policies, helped sustain economic growth at around 5 percent and drew largely from initiatives already outlined in the 14th Five-Year Plan, expediting their implementation.

This capacity to stabilize expectations, reinforce growth momentum and mitigate economic fluctuations has made China one of the most stable major economies in terms of growth performance over the past decade, despite the highly volatile global economic environment.

The five-year plans stand as a hallmark of China's governance system and a distinctive strength of its development model. By translating the institutional advantages into effective national governance, they have strongly supported the modernization of China's governance system and capacity.

From a global perspective, China has pioneered a new form of development planning that integrates socialist principles with market economy mechanisms. This innovative approach has not only powerfully driven national progress but also significantly enhanced the effectiveness of state governance.

The successful implementation of five-year plans offers a Chinese approach as reference and contributes Chinese wisdom to countries seeking to build more effective economic and social governance systems.

The author is a professor at the School of Public Policy and Management and the deputy dean of the Institute for Contemporary China Studies at Tsinghua University. The author contributed this article to China Watch, a think tank powered by China Daily.

The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn.