China stays the course on reform after third plenum, leaving Western businesses in limbo

Without a hint of major pro-market reform after the third plenum, Western firms in China appear in a similar position as they were before

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China’s Communist Party wraps up policy meeting amid growing uncertainties

Frank Chenin Shanghai

Published: 4:00pm, 19 Jul 2024Updated: 5:49pm, 19 Jul 2024

Representatives of Western firms in China have expressed disappointment over Beijing’s medium-to-long-term vision for the economy, saying a document summarising the recently concluded third plenum lacks specific measures to improve the climate for business despite oft-repeated pledges of support.

Overseas enterprises in China will remain in a holding pattern before increasing their investments in the world’s second-largest economy, they said, waiting until a clearer picture emerges of what new reforms may be in store.

“Leading up to the third plenum, German companies had hoped for more guidance and clarification relating to economic stimulus measures as well as reforms,” said Maximilian Butek, executive director of the German Chamber of Commerce in China.

“Instead, it seems that we must prepare for a policy marked by caution and continuity.”

Third plenums – this one a meeting of the Communist Party’s 20th Central Committee – have historically precipitated extensive changes to the country’s economy, with sweeping ideological statements issued to chart the course of policy for the next five years or more.