On March 12, 2026, China’s National People’s Congress approved the Outline of the 15th Five-Year Plan for National Economic and Social Development (the Plan), which serves as the country’s blueprint for the five-year period from 2026 to 2030.
The Plan’s core objective is clear: to lay a solid foundation for doubling per capita GDP by 2035 from the 2020 level, thereby reaching the threshold of a moderately developed country. Achieving this will require China to sustain average annual growth of approximately 4.17% over the next decade. The plan prioritises “high-quality development”, as reflected in its 20 main indicators spanning five dimensions: economic development, innovation-driven development, people’s livelihood and well-being, green development, and security and resilience.
As the world’s second-largest economy, China’s strategic choices over the next five years will have far-reaching implications for global supply chains, investment flows, and international relations. An understanding of this blueprint is therefore essential for grasping China’s trajectory and anticipating both opportunities and challenges in future China–EU relations.
I. Three Lenses for Understanding China’s Strategic Focus
The Plan runs across 18 parts, and 62 chapters, covering everything from economic development and technological innovation to rural revitalisation, military modernisation, and foreign policy. To make sense of this complex document, three core concepts are particularly useful.
1. New Quality Productive Forces
First introduced by Chinese leadership in September 2023, the concept refers to advanced productivity that breaks with traditional growth models, driven by technological breakthroughs, innovative allocation of production factors, and deep industrial transformation.
China has increasingly positioned itself as one of the world’s major innovation hubs, particularly in fields such as artificial intelligence, quantum technologies, and new energy. According to the Global Innovation Index 2025 which assesses the innovation capabilities of 139 economies, China ranked at 10th, with Denmark at the 9th and Germany at the 11th. One key driver behind this progress has been sustained investment. On R&D, China’s total R&D investment exceeded $569 billion in 2025, reaching 2.8% of GDP, higher than that of the EU (2.24% in 2024). The Plan calls for annual growth of over 7% in R&D spending, which is a continuation of the target set during the 14th Five-Year Plan period. This signals China’s commitment to maintaining high-intensity investment in innovation, even as the pace of economic growth moderates. Such sustained increases will help consolidate China’s leading position in key science and technology fields.
The plan also lists several projects linked to new quality productive forces. In semiconductors, for instance, China vows to “take extraordinary measures to drive decisive breakthroughs” across full chains in integrated circuits, machine tools, high-end instruments, basic software, advanced materials and bio-manufacturing. In AI, it promotes an “Artificial Intelligence+” initiative spanning industrial design, pilot testing, and full-scale production, and calls for the development of next-generation smart devices. At the same time, structural constraints remain. China still lags behind leading innovation economies in fundamental research. The Plan explicitly acknowledges this gap and calls for increased and more stable funding, alongside institutional reforms to improve research efficiency and talent incentives.
2. Investing in Human Capital
For the first time, the 15th Five-Year Plan explicitly links investment in physical assets with investment in human capital. With seven of its main indicators, more than a third, are dedicated to people’s livelihood and well-being, with quantitative targets spanning education, health, elderly care, and childcare.
China faces important demographic challenges. By the end of 2025, the population aged 60 and above had reached 323 million (23.0% of the total population), the 2025 birth figure stood at 7.92 million, yielding a birth rate of 5.63‰, much lower than that of the EU (7.9‰ in 2024). In response, the Plan devotes substantial attention to both ageing and fertility. On ageing, it aims to expand community-based elderly care services, targeting coverage of over 70% and upgrading around 2,000 public institutions. It also emphasises the development of a “silver economy”, encouraging private-sector participation in elderly care, rehabilitation, and age-friendly technologies. On fertility, the Plan goes beyond childcare provision. It includes broader “family-supportive” measures such as reducing education and housing costs, expanding parental leave policies, and improving workplace protections for women, which reflects a more systemic approach compared to earlier policy cycles.
Education represents another central pillar. According to the Plan, by 2030, the average years of schooling for the working-age population should rise from 11.3 (2025) to 11.7 years. Measures include supporting new campuses for high-quality universities—with a planned increase of 100,000 undergraduate places—and establishing around 200 high-level applied undergraduate colleges. At the secondary level, over 1,000 new high-quality regular senior high schools are to be built or renovated, particularly in areas with large or growing permanent populations.
3. High-Standard Opening Up
In the Plan, China has reaffirmed its commitment to opening up. In fact, substantive progress has been made in this direction in the past years. Foreign investment restrictions in the manufacturing sector have been fully removed in 2024. In late 2025, the Hainan Free Trade Port initiated island-wide special customs operations, marking a significant step forward. China has also implemented unilateral visa exemptions for citizens of 50 countries, including 25 EU member states.
Looking ahead, the Plan outlines measures to expand market access and open up additional sectors, with a particular emphasis on services. These commitments entail the orderly liberalisation of telecommunications, internet services, education, culture, and healthcare, as well as pilot programmes in value-added telecommunications, biotechnology, and wholly foreign-owned hospitals.
At the same time, the business environment remains a key concern for foreign investors. According to the “European Business in China Business Confidence Survey 2025” jointly released by the EU Chamber of Commerce in China and Roland Berger, business confidence has fluctuated amid geopolitical tensions, regulatory uncertainty, market access barriers, and China’s overall economic performance.
The Plan addresses some of these concerns by emphasising national treatment for foreign firms, regulatory transparency, and alignment with international standards. It also highlights trade facilitation measures, such as cross-border e-commerce development and improved logistics networks, as well as financial opening through expanded market connectivity and gradual renminbi internationalisation. Nevertheless, implementation will be decisive. Opening up is not a unilateral process: it depends not only on China’s domestic reforms but also on reciprocal arrangements, geopolitical conditions, and regulatory trust. For European stakeholders, the key question is less about stated commitments than about how consistently and predictably they are carried out in practice.
II. The 15th Five-Year Plan and Europe: Finding a New Equilibrium
China–EU relations have navigated a turbulent period in recent years. The EU now characterises China as a “partner, competitor, and systemic rival,” while pursuing their “de-risking” strategy. Trade frictions, heightened investment screening, and restricted technology exchanges have become defining features of the bilateral dynamic. Against this backdrop, what implications will the Plan hold for Europe and for the future trajectory of China–EU relations?
A direct and immediate answer lies in the intensifying competition between China and Europe in high-end manufacturing and technology. Over the past few years, facing the rapidly advancing innovation and production capabilities of China, the United States, and other global competitors, the EU has been compelled to significantly ramp up its innovation investment and introduce market protection measures, with the Industrial Accelerator Act as a fresh example. Through the Plan, China has signalled its firm resolve to further elevate its innovation and manufacturing capacities. The sectors prioritised under “new quality productive forces”—AI, semiconductors, new energy, biomanufacturing—are precisely those where Europe seeks to maintain or strengthen its edge. In new energy vehicles, for example, China’s exports surged by over 70% year-on-year in 2025, with Europe as a key destination. As Chinese firms scale up and refine their technology, European automakers might face sharper competition across the globe.
Yet, the other side of the coin holds real opportunities for European stakeholders.
Services liberalisation offers new avenues for European strengths. Pilot openings in telecoms, internet, education, and healthcare will benefit European providers of finance, insurance, legal services, engineering design, professional certification, and medical care. For instance, China signalled greater openness in its healthcare sector by launching a pilot program that allows the establishment of wholly foreign-owned hospitals in selected cities and regions, such as Beijing, Shanghai, and Hainan. These pilots open a door for top European healthcare providers. Against the backdrop of rising demand among Chinese consumers for higher-quality services, European clinical expertise and established brand reputation are well-positioned to gain significant traction. Recent UK–China memorandums of understanding on services cooperation during Prime Minister Keir Starmer’s visit may point the way forward.
China’s broader push to boost consumption may further open doors for European goods and services. Although China is often criticized for insufficient consumption, it is now the world’s second-largest importer and consumer market, with total imports reaching approximately €2.58 trillion in 2025. It is also worth noting that despite an increasingly difficult business environment, European companies still view China as an important market and are stepping up their investment. During the 15th Five-Year Plan period, China is committed to implementing income growth initiatives for urban and rural residents and taking strong measures to stimulate consumption. The Plan also signals an intent to address issues such as excessive price competition and industrial overcapacity, which could improve market conditions and profitability across sectors, including for foreign firms operating in China.
III. Conclusion: Towards Pragmatic Cooperation
There is reason to expect that China emerging from the 15th Five-Year Plan will be more innovation-driven, more people-focused, and more open. For Europe, this blueprint is neither a simple menu of opportunities nor a threat, it is a complex reality that calls for clear-eyed analysis and strategic response.
The next five years could well determine whether China and Europe can forge a new equilibrium, one that balances competition with collaboration. Faced with China pursuing the status of a moderately developed country, Europe has to acknowledge the competitive pressures. At the same time, it could also recognise the substantial common interests that remain. Rather than slipping into a zero-sum logic of rivalry, a wiser approach would be to build new frameworks for cooperation.
Author: Prof. ZHANG Chao, EIAS Visiting Research Fellow, Associate Professor, Acting Deputy Director of Department of International Relations Institute of European Studies, Chinese Academy of Social Sciences
Photo credits: European Union