Five pivotal years | the weekly recap

October 2025 was one for the books, folks.

• The month started with a sharp escalation in US-China trade tensions.
• Then came feverish negotiations to stabilize the relationship.
• Later in the month, China’s leaders took a quick break from the trade drama for the Party Central Committee’s Fourth Plenum.
• This week, they published their Proposals for the upcoming 15th Five-Year Plan (FYP) (2026-2030) – a landmark document that will shape China’s governance and economic ambitions over the next five years.
• Then, on Thursday, Xi Jinping and US President Donald Trump met in person for the first time in six years – agreeing on a framework for sustainable trade de-escalation.

What a month.

As ever, it’s hard to know quite how to step back and take stock of yet another hugely eventful week – which is what I try to do with these weekly notes.

Given that challenge, I want to focus today on one aspect of the 15th FYP Proposals – officially released on Tuesday – that’s been largely overlooked in the commentary so far.

• I’ll leave analysis of the Xi-Trump trade agreement for another day – though I touch on trade issues briefly below.  
• Lord knows, there’s already been a firehose of takes on that meeting anyway, including our own rundown for subscribers, published Thursday.
• You can also listen to our latest podcast, where my colleague Kendra Schaefer and I unpack the new US-China agreement in more detail.

Meanwhile, the element of the 15th FYP Proposals that really jumped out at me was encapsulated in the line (emphasis added):

• “The ‘15th Five-Year Plan’ period will play an important role in inheriting the past and ushering in the future in the process of basically achieving socialist modernization.”

My translation: The next five years are pivotal for realizing Xi Jinping’s overarching program to fundamentally shift China’s economy toward a new growth model – which I discussed in depth last week – and to make decisive progress toward achieving technological self-sufficiency.

• Indeed, the Proposals are suffused with an unusual sense of urgency across a range of economic and technological policy goals.

That’s not something we typically see in China’s Five-Year Plans.

• Normally, these plans read like a laundry list of top-line policy agendas – loosely grouped under catch-all headings like “improving people’s livelihoods” and “maintaining a moderate speed of economic growth.”

These latest FYP Proposals, by contrast, follow a much more coherent logic:

• Virtually every policy agenda feeds neatly into the overarching goals of boosting productivity in the industrial sector and achieving technological breakthroughs across a range of industrial applications.

What’s more, the Proposals also adopt especially strong language regarding the need to strengthen China’s tech self-sufficiency and develop “independent and controllable” innovation and technologies.

• In my view, this is a pretty clear sign that Beijing sees the next five years as a make-or-break window for achieving technological independence – both as a route to economic upgrading and, implicitly, a way to relieve US-led pressure on China’s tech sector.  

Most notably, the Proposals pledge to adopt “extraordinary measures” to strengthen China’s innovation capabilities and strategic technology research.

• And while it’s unclear what those “extraordinary measures” will involve, the language points to a greatly intensified drive to make breakthroughs in areas where foreign tech currently has China in a chokehold.

The Proposals further underscore that China will pursue “decisive” breakthroughs in key areas like:

• Integrated circuits
• Industrial machinery
• High-end instruments
• Basic software
• Advanced materials
• Biomanufacturing

And while China’s policymakers often talk about achieving decisive policy “victories” or becoming a “superpower” in any given area, this type of language was more prevalent, consistent, and urgent in the Proposals than in most other policy documents.

For me, the message from China’s leaders is clear: There is only a narrow window to secure breakthroughs in key technologies, so the entire policy apparatus must be laser-focused on making them happen.

And here’s where US-China trade tensions come back into play. 

• By revving up the sense of urgency to achieve key milestones in the quest for technological self-sufficiency, China’s leaders are looking to better insulate the country against what they see as inevitable future efforts by the US and others to thwart China’s technological advancement. 
• Indeed, if China can reduce, or even eliminate, its reliance on Western firms for key chokepoint technologies – particularly in the six areas listed above – it will be much less exposed to tech restrictions the next time around.

What’s more, Xi Jinping appears confident that China can break through US chokeholds on key semiconductor technologies much more quickly than the US can replace its dependence on China for critical minerals and rare earths.

• Frankly, it’s not a bad bet, as China appears to be steadily closing the gap in producing leading-edge chips, while the US and its allies are only just beginning to really reckon with the gap they face on rare earths.

The upshot: China’s leaders assess that their key points of leverage in the trade fight will remain stronger – and last longer – than the US’s critical points of leverage.

• In military speak, they believe they have – and can maintain – “escalation dominance” in a trade war, if things go south again.
• And it’s hard to disagree, given how the US has repeatedly folded in the face of rare earths disruptions from China over the past few months.

And that’s the key reason that getting a one-year extension of the trade ceasefire with Trump in South Korea was so important for China.

• Chinese officials believe that a year from now, they’ll be much closer to producing leading-edge chips than the US will be to establishing a viable alternative rare earth supply chain. 

And five years from now – as outlined in the 15th FYP Proposals – they plan to have closed the chips gap completely.

• I have no idea if they will be successful in that pursuit, but as I read the latest FYP Proposals, they seem dead set on making it happen.

Andrew Polk, Co-founder, Trivium China

What you missed

Econ and finance

The central bank (PBoC) has changed its tune on trading Chinese government bonds (CGBs).

• On Monday, PBoC Governor Pan Gongsheng said the government bond market is now operating well, and that the PBoC will resume its trading operations.
• Pan also poured cold water on speculation that the PBoC might greenlight yuan-backed stablecoins – noting they create loopholes that can be exploited for money laundering and terrorist financing.

US-China

On October 30, Xi Jinping and US President Donald Trump agreed to a one-year trade framework, meant to reduce trade tensions and stabilize the bilateral relationship.

• The agreement covered: 1) fentanyl cooperation and a reduction in related tariffs, 2) the resumption of US soybean purchases by China, 3) ongoing suspension of tariffs enacted since early April, 4) a pause on implementing the latest round of rare earth and tech export controls, and 5) a postponement of countervailing measures on each other’s maritime, logistics, and shipbuilding industries.
• Further details should emerge in the coming weeks, as working-level meetings hash out the specifics of the agreement.

Business environment

Top leaders made further opening to foreign business and investment a high priority in their Proposals for the 15th Five-Year Plan (FYP), which dropped in full on Tuesday.

• This issue now ranks fifth on the priority list, up from No. 9 five years ago. We expect this push will entail building a unified (and massive) national market to address local protectionism and making policy adjustments more predictable.
• That said, China’s response to geopolitical tensions will inevitably hurt some foreign firms – particularly those providing sensitive technologies – as policymakers look to improve self-reliance.

Politics

At an October 24 presser, Jiang Jinquan, head of the Party’s Central Policy Research Office, revealed Premier Li Qiang’s key role in developing the Party’s blueprint for the upcoming 15th Five-Year Plan.

• Xi Jinping chaired two symposiums with top provincial officials and non-Party representatives to hear their thoughts on the plan; but he entrusted Li with chairing three additional symposiums to gather views from business leaders, scientists, and grassroots representatives.
• That represents a big shift from five years ago, when Xi personally presided over all seven 14th Five-Year Plan-related symposiums himself – covering every major stakeholder group.

Agriculture and rural affairs

State-owned grains trader COFCO has bought three cargoes of American soybeans, ending China’s record-breaking absence from the US market, according to a Reuters scoop on Wednesday.

• This followed a string of positive signals in the lead-up to the October 30 meeting between Xi Jinping and US President Donald Trump.
• The three cargoes represent roughly 180,000 metric tons of soybeans – a tiny fraction of China’s typical monthly import levels, which generally total well over 10 million tons.

Foreign affairs

On Monday, Premier Li Qiang met Australian Prime Minister Anthony Albanese in Kuala Lumpur, Malaysia.

• Li hailed “steady progress” in the relationship, saying: “China is ready to…actively explore the review and upgrading of the China-Australia Free Trade Agreement.”
• Albanese described the meeting as “positive,” noting Li “heard” his concerns about the recent confrontation between a Chinese fighter jet and an Australian surveillance plane in the South China Sea.

Last Saturday, Premier Li Qiang arrived in Singapore for his first official visit – and the first by a Chinese premier since 2018.

• During a meeting with Singapore Prime Minister Lawrence Wong, Li touted the longstanding, practical cooperation between the two countries – calling for more of the same across the digital and green economy, artificial intelligence, new energy, and biomedicine.
• They wrapped the meeting by signing or renewing eight cooperation agreements spanning green development, the digital economy, food safety, and maritime shipping decarbonization and digitization, among other areas.

As always, it was a busy week in China.

• Thank goodness Trivium China is here to make sure you don’t miss any of the developments that matter.