The Chinese economy was the focus of Xi’s New Year’s speech – and that was positive

Chinese President Xi Jinping made his annual television broadcast new year’s address on December 31, and commentators were quick to share their interpretation. Some have emphasized Xi’s passing reference against Chinese reunification as a threat to Taiwan. Others have focused on Xi’s comments about the Chinese economy and have taken them as one anxious reaction to the re-election of Donald Trump as US president.

However, these accounts miss the bigger picture. Xi’s New Year’s speech speaks to the growing uncertainty over the Chinese Communist Party’s (CCP) grip on power. This uncertainty is evident in the way Xi’s comments, backed by the party’s control of the Chinese media, sought to deceive the Chinese people.

The mainstay of Xi’s speech concerned China’s economic success. Stressing that China’s economy is booming, he explained that China’s total GDP is expected to soon exceed 130 trillion yuan ($17.7 trillion). This corresponds to one 4.9 percent increase in GDP over the past 12 months.

Reports of Xi’s speech in the Chinese media go one step further. China Daily, the official newspaper owned by the CCP, often did this communicate the party’s position in English language praised Xi’s “encouraging speech” and emphasized the impressiveness of China’s “remarkable” growth rate. An article published on January 1 explained that other developed economies were struggling to achieve an average growth rate of 1.5 percent.

The positive economic commentary of Xi’s speech leaves out the reality of China’s economy growth has sloweddeclining from 5.2 percent in 2023. While a growth rate of 4.9 percent is impressive compared to other developed economies, it is disappointing in the context of Chinese economic growth. China has achieved annual growth rates of more than 10 percent in the 2000s, with GDP even growing by around 13 percent in some years.

A year ago, Xi said in his 2024 speech acknowledged the challenges facing the Chinese economy. He promised economic interventions that would accelerate growth and boost job creation to tackle worrying youth unemployment. Despite these interventions, China’s economic growth is lagging behind continues to slow down and youth unemployment remains high.

It may be difficult to understand why Xi and the CCP admitted to economic challenges when Chinese growth was higher and celebrated economic success when growth had slowed. But it makes sense if you look at it through the lens of “changing goals” – an act that goes beyond the positive spin that governments put on their countries’ economic performance.

Goal shifting is a form of political gaslightingin which an established goal is ‘shifted’ to a goal that is easier to achieve. This means that an unfavorable result according to the standard of the original goal can be presented as an achievement according to the standard of the new goal.

If we take China’s GDP growth of 4.9 percent in 2024 as an outcome, it can be considered unfavorable compared to China’s growth of 5.2 percent in 2023. However, by shifting the target to higher GDP growth in China than other developed economies – a feat that has never really been doubted – China’s growth rate by 2024 can be described as “remarkable” in the Chinese media.

It appears that the CCP is using its influence and control over the Chinese media to emphasize the economic message of Xi’s speech. In doing so, it puts the Chinese people under fire by shifting China’s economic goals toward downplaying its struggling economy. At the same time, the CCP views the relative strength of China’s growth compared to other countries as a success of the party’s economic stewardship.

Since the 1980s, the CCP has relied on the two pillars of economics and nationalism to uphold the legitimacy of his government. Economically, its legitimacy was maintained by years of high growth, which has since declined more than 800 million lifting people out of poverty in China. But as growth has slowed over the past decade, the CCP has shifted to a reliance on nationalism.

The CCP and the Chinese nationalist movement have a symbiotic relationship. The CCP promotes nationalistic values in schools and supports nationalist projects across China, such as historical societies, patriotic statues and museums. This gives nationalist groups a vested interest in supporting the CCP.

However, this relationship is harmful for the CCP in the long term. The CCP cannot restrict nationalist groups without undermining its own nationalist credentials. This has resulted in scenarios where nationalist groups have acted against the wishes of the CCP launching cyber attacks both in China and abroad.

The two-pillar model the CCP has relied on for decades is faltering. In his previous New Year’s speech, Xi took the unprecedented step of recognizing China’s economic problems. The CCP was reluctant to stir up nationalist sentiment and tried to use the economic pillar by betting on a turnaround in the economic situation by 2024. This turnaround did not materialize.

The CCP has become increasingly insecure, so Xi adjusted the targets for assessing China’s economic performance in his 2025 New Year’s speech. Meanwhile, the party encouraged reporting supporting Xi’s speech, hailing China’s slowing growth and worsening economic problems as a “remarkable” economic achievement.

This article was originally published on The conversation. Read the original article.