MacroPolo

A think tank once upon a time

[MacroPolo @MacroPoloChina]

After eight years, Macro Polo has ceased operations as the Paulson Institute will focus its independent research on supporting its programs as it continues to diversify its scope.

We appreciate the community that has grown around Macro Polo and the fruitful engagement we’ve had with our legion of smart and sharp audience. You’ve pushed us to deliver even more original work and innovative products. Our body of work speaks for itself, and we hope it will have a long shelf life – that was the intent from MP’s inception.

MP’s website is now archived and no new work will be published henceforth.

Thank you all for the support over the years, it has been a privilege to have had a home at the Paulson Institute and to have built it the way we did.

[Carnegie China @CarnegieChina]

我们很高兴地宣布马旸（@damienics）将担任卡内基中国新一任主任。他将常驻新加坡，领导卡内基中国团队开展工作，围绕中国议题提供新颖见解、促进对话并影响从北京到曼谷等广泛地区的政策讨论。https://t.co/EaiIyadctW

[Damien Ma @damienics]

Personal update. Excited to be Singapore-bound and to be building out something unique in APAC

[Damien Ma @damienics]

Sounds familiar - from Vogel's 1985 book Comeback

[Damien Ma @damienics]

It's often assumed energy subsidies are a key incentive for investment in China.

Here's some evidence - from the Baotou Rare Earth high tech Zone on operating cost for investors in the 2010s. For any capacity expansion, you're basically getting free energy:

[Damien Ma @damienics]

Pubs of another era.

Never realized the dude on the cover of the GFC edition of Caijjng looks like Chris Kattan from SNL

[Damien Ma @damienics]

Digging up a different era of US-China collab:

[Damien Ma @damienics]

Every major American city needs this guy from Shenzhen. This is Chinese speed:

https://t.co/OcvtZn9T4f

[Damien Ma @damienics]

So China is 18% of world population but 61% of its geniuses (here defined as IQ > 135) - interesting chart from @ZixuanMaWrites Substack

[Damien Ma @damienics]

Yup, He Lifeng doubles down on 因地制宣 in his article on the 15th fyp. I expect 20 more explainer pieces on this neologism...

党的二十届四中全会通过的《中共中央关于制定国民经济和社会发展第十五个五年规划的建议》对因地制宜发展新质生产力作出重要部署，我们要认真学习、深刻领会、贯彻落实。

一、深刻理解因地制宜发展新质生产力的重大意义

习近平总书记关于发展新质生产力的重要论述，体现了对生产力发展一般规律和我国发展阶段性特征的深刻把握，创新和发展了马克思主义生产力理论，丰富和发展了习近平经济思想，为新时代新征程上推动高质量发展和中国式现代化建设提供了科学指引。“十五五”时期是基本实现社会主义现代化夯实基础、全面发力的关键时期，因地制宜发展新质生产力具有重大理论和现实意义。

[Steve Hou @stevehou]

@damienics @MacroPoloChina You need to tag @nvidia @NVIDIAAI

[Damien Ma @damienics]

Jensen, if you're gonna continue citing @MacroPoloChina data on AI talent, give it attribution!

[Damien Ma @damienics]

Terribly sad news of the unexpected passing of Joe Fewsmith, a giant in the field of Chinese politics, a terrific professor, and just a really great guy. I was privileged to have studied under him.

He got a lot of things right on Chinese politics I think, and his "Rethinking Chinese Politics" is as relevant as ever, particularly on Leninist system's evergreen "succession" problem:

[Damien Ma @damienics]

Fuller clip of Xi-Lee gift exchange interaction

[Gene Loh @gene_loh]

@riotgrandma72 It doesn't matter if a wing is left or right, as long as it can fly.

The “Frankenstein” That Wasn’t: A Realistic Appraisal of Today’s China
https://t.co/CKsDVj9blV
@MacroPoloChina

[Damien Ma @damienics]

Here's what the Chinese government thinks are its achievements over last five years, many of which will surely make it into the 15th five year plan:

The “14th Five-Year Plan” Is Drawing to a Close

During the “14th Five-Year Plan” period, under the strong leadership of the Communist Party of China Central Committee with Xi Jinping at its core, the entire nation worked with unity of purpose and determination, resolutely focusing on doing its own work well. Through new great struggles, China achieved new historic accomplishments that have attracted global attention. The great rejuvenation of the Chinese nation is unstoppable.

Staying the Course and Advancing High-Quality Development

In the first three quarters of 2024, China’s GDP grew by 5.2% year-on-year.
The figure, released on October 20, demonstrates that China’s economic ship has weathered external pressures and continues to show strong resilience.
“The Party Central Committee’s centralized and unified leadership is the fundamental guarantee for doing economic work well. At critical moments, the Party has made timely assessments and decisions to ensure that China’s economic ship sails steadily and far.”

Facing uncertainty, the most important thing is to focus on doing our own work well.

During the “14th Five-Year Plan” period, the world underwent accelerated transformation, and reform, development, and stability tasks became more complex and difficult. Through proactive action, China advanced high-quality development, made solid progress on Chinese modernization, and achieved new breakthroughs and historic accomplishments.

“Quantity”: GDP crossed new thresholds of RMB 110 trillion, 120 trillion, and 130 trillion. By year-end 2024, it is expected to reach around RMB 140 trillion.
Economic increment during the period is projected to exceed RMB 35 trillion — equivalent to adding an economy the size of the Yangtze River Delta, larger than the GDP of the world’s third-largest economy.
Global media have noted that these achievements exceeded expectations.

“Quality”:
China’s average annual GDP growth of 5.5% over the first four years of the plan was among the highest of major economies, contributing about 30% to global growth annually — making China the most stable and reliable engine of world growth.
Innovation Breakthroughs Underscore Economic Transformation
Comac C919 jetliner negotiations with Malaysia’s AirAsia, and a planned order of 20 C909 aircraft from Cambodia’s national airline highlight Chinese aerospace progress.

The launch of China’s first domestically built electromagnetic catapult aircraft carrier Fujian, the world’s first fourth-generation nuclear power plant at Shidaowan, and China leading the world in the number of R&D personnel and top 100 science and technology clusters for three consecutive years all reflect innovation-driven momentum.
Xi Jinping emphasized that China’s vast domestic market is a strategic advantage — it must be fully leveraged and strengthened to sustain development initiative.

From 2021 to 2024:

Domestic demand contributed 86.8% of economic growth.

Final consumption accounted for 59.9% of growth — 11.1 percentage points higher than in the 13th Five-Year Plan period.

China remained the world’s second-largest consumer market and the largest online retail market.

China also achieved:

11.6% cumulative reduction in energy intensity over four years,

global leadership in new energy vehicle output,

accelerating development of the Beijing–Tianjin–Hebei region, Yangtze River Delta, and Guangdong–Hong Kong–Macao Greater Bay Area (now accounting for over 40% of GDP),

8% annual average growth in goods trade, and

over 1 billion mu of high-standard farmland built.

Standing at the Forefront — Deepening Reform and Opening Up

Market access reform advanced further:

The 2024 negative list for market access was slimmed down again — from 117 items (2022 version) to 106. Outside the list, all businesses can legally enter on equal footing.

Over the past five years, China has tackled the hardest reform issues:

Built a high-level socialist market economy system with consistency evaluations for new macro policies, implemented the Fair Competition Review Regulations, passed the Private Economy Promotion Law, and advanced the unified national market.

Established the national carbon emissions trading market, enhanced ecological protection mechanisms, and piloted “Beautiful China” initiatives.

Expanded social insurance for flexible workers and migrant labor, eased household registration (hukou) restrictions outside a few mega-cities, introduced free preschool education pilots, and gradually extended the statutory retirement age.

Over 300 reform measures adopted by the 20th Central Committee’s Third Plenum are driving reform deeper and wider.

Xi Jinping emphasized:

“We will not avoid confronting contradictions, will not hesitate to remove entrenched problems, and will not shrink from risks and challenges.”

China has also steadily expanded high-level opening up:

Eliminated foreign investment restrictions in manufacturing and expanded services sector pilots.

Continued to host major trade fairs such as the CIIE, Canton Fair, CIFTIS, and CICPE.

Expanded unilateral visa-free access to 47 countries.

Granted zero-tariff treatment to 100% of tariff lines for least developed countries and African countries with diplomatic ties.

By shifting from factor-based openness to institutional openness, China continues to turn its own development into opportunities for the world.

“To walk with China is to walk with opportunity. To believe in China is to believe in the future. To invest in China is to invest in tomorrow.”
— Xi Jinping, March 2025

Advancing Livelihood Improvements with Determination

In March 2025, Xi visited a modern flower industry park in Lijiang, Yunnan. The project employed more than 300 local residents.

“Your business is thriving and aligns with modern agriculture. May your lives be as beautiful as these flowers,” he said.

The 14th Five-Year Plan included seven key livelihood indicators — over one-third of all major plan metrics, the highest proportion in history.
Employment remained a top priority:
Urban job creation exceeded 12 million annually, and income growth kept pace with GDP.
In May 2024, the Politburo conducted its 14th collective study session on employment, followed by a central policy document in September.

Progress across key areas:
Over 300 cities built comprehensive childcare service centers.
Preschool enrollment reached 92%; higher education enrollment reached 60.8%.
560 million cross-province medical bill settlements were processed.
Life expectancy rose to 79 years.
30 million rural residents maintained stable employment annually.

By putting people at the center and ensuring development benefits are shared by all, the quality of life for 1.4 billion people has continued to improve.

A New Starting Point — Building Toward the “15th Five-Year Plan”

From October 20–23, the Fourth Plenary Session of the 20th CPC Central Committee was held in Beijing. The meeting reviewed the recommendations for formulating the “15th Five-Year Plan”, drawing the blueprint for China’s development over the next five years.

As China stands on this new historical starting point, the advantages of its governance system, huge market, complete industrial system, and rich human capital are increasingly prominent. By maintaining strategic resolve and confidence, China is well positioned to overcome future challenges and write an even more brilliant chapter of Chinese modernization.

[Damien Ma @damienics]

Wen Jiabao's "four uns" on Chinese economy: unbalanced, unsustainable, unstable, and uncoordinated

Xi Jinping's "four uns" on the global environment: unprecedented, unstable, uncertain, and unpredictable

Preview of the 15th five year plan from Seeking Truth:

During the “15th Five-Year Plan” period, China’s development environment will undergo profound and complex changes.

Major power competition and technological revolutions are increasingly intertwined, while the tasks of reform, development, security, and stability are becoming more challenging. Strategic opportunities and risks are unprecedented, and unstable, uncertain, and unpredictable factors are rising significantly.

China must grasp global development trends and address major domestic issues, while planning and accelerating the development of new quality productive forces at a higher level. This will enable revolutionary progress in social productivity and allow the country to use the certainty of high-quality development to cope with various uncertainties, firmly seizing the initiative in both national development and international competition.

1. Strengthen Strategic Top-Level Design and Build a Policy System for New Quality Productive Forces

Developing new quality productive forces is a major strategic and holistic mission that cuts across all aspects of China’s “Five-Sphere Integrated Plan.”

Top-level planning: Improve the national strategic planning system, include new quality productive forces as a core component of the 15th Five-Year Plan, and set clear national-level goals, priorities, technical roadmaps, industrial layouts, implementation pathways, and timelines.

Policy coordination: Integrate this agenda into fiscal, financial, industrial, environmental, regional, educational, science and technology, and talent policies, creating stronger coordination mechanisms across ministries, between central and local governments, and among regions and enterprises.

Security guarantees: Strengthen institutional design, policy support, and legal safeguards in critical sectors—food, energy, finance—as well as strategic emerging sectors like AI and biopharma, and in frontier areas such as cross-border data flows and overseas interests.

Dynamic policy adjustment: Establish a mechanism to adjust and optimize short- and medium-term strategies in response to changes in international politics, economics, and technology, ensuring overall goals are achieved.

2. Deepen Full-Chain Technological Innovation to Build a Strong Foundation

Technological innovation is a complex systems project.

Basic research: Focus on strengthening weak links in basic research, concentrating national strategic resources, aligning with the “Four Orientations,” fostering interdisciplinary collaboration, combining competitive and stable funding, and encouraging original theoretical breakthroughs.

Core technologies: Target chokepoint technologies, adapt to multi-route, dynamic, cross-cutting technology evolution, prioritize key common, frontier, engineering, and disruptive technologies, and build both “hard infrastructure” (e.g., large scientific facilities) and “soft infrastructure” (e.g., open R&D databases).

Technology transfer: Establish integrated innovation consortia linking large, medium, and small enterprises with academia, build full-chain “proof-of-concept—pilot testing—application validation” platforms, and accelerate multi-scenario deployment, large-scale diffusion, frequent iteration, and continuous upgrading of indigenous technologies.

3. Reshape the Industrial System to Provide a Solid Platform

Adjusting China’s industrial layout to reflect changing domestic and international conditions is both urgent and long-term:

Traditional, emerging, and future industries: Promote upgrading of traditional industries toward higher-end, smarter, greener production; consolidate competitive advantages in emerging sectors like the “new three” (EVs, lithium batteries, solar), and develop strategic future industries (e.g., advanced manufacturing, information, materials, energy, space, health).

Digital–real economy integration: Deepen integration of digital and physical economies, promote cross-sector convergence, and foster new business models and industries.

Regional optimization: Tailor development strategies to local resource endowments, industrial bases, and research capacity. Encourage industrial gradient transfer and cross-regional collaboration through joint R&D, co-investment, shared scenarios, co-development of markets, and risk/revenue sharing. Strengthen industrial resilience and security by guiding rational cross-border industrial chain layout.

4. Advance Institutional Reforms to Align Production Relations with New Productive Forces

Production relations must evolve to match advances in productive forces:

Innovation主体 (actors): Strengthen both state-owned and private sectors—enhance SOE competitiveness and channel state capital into strategic emerging industries; implement the private economy promotion law; encourage private sector participation in national projects.

Innovation environment: Deepen the development of a unified national market, curb wasteful “involutionary” competition, regulate local investment promotion, enforce industry self-discipline, manage capacity in emerging sectors, and build regulatory frameworks for fields like AI.

Innovation factors: Expand talent pipelines in frontier disciplines, reform evaluation systems to emphasize innovation capacity and impact, improve overseas talent policies, build patient capital through improved public guidance funds, strengthen tech and green finance systems, enhance IP protection, and build robust data property rights and trading mechanisms.

5. Expand High-Level Opening Up to Create a Favorable External Environment

No matter how the global landscape shifts, China will remain committed to opening up to drive reform, development, and innovation:

Partnership diversification: Deepen engagement with developed countries while expanding cooperation with developing nations in technology, capacity, and standards.

Multilateralism: Support the multilateral trading system centered on the WTO, promote high-quality Belt and Road cooperation, and deepen multilateral mechanisms like the SCO, BRICS, China–ASEAN, China–Central Asia, China–Africa, China–Arab, and China–Latin America partnerships.

“Bring in” and “Go global”: Combine investment, technology, and talent inflows with outward expansion—participate in major international science programs, establish overseas R&D centers and production bases, and strengthen risk monitoring and response.

Institutional openness: Expand both pre-entry and post-entry openness, align with high-standard international trade and economic rules, and harmonize rules, regulations, management, and standards to build a world-class business environment that is market-oriented, rule-based, and international.

[Damien Ma @damienics]

Flashback that's relevant today: 20 years ago China's CNOOC attempted, but failed, to acquire Unocal Oil of California. Unocal also was the parent of Molycorp, the owner of the Mountain Pass REE mine.

I do not recall most, if any, of the coverage of the deal at the time mentioning the REE angle.

[Damien Ma @damienics]

If you've prompted ChatGPT about rare earth magnets, given recent events, you are likely to get ⁦@MacroPoloChina⁩ numbers:

[Damien Ma @damienics]

Good to see @warburgpincus using @MacroPoloChina data for its presentation in Shanghai:

[Damien Ma @damienics]

Chinese readout of Xi-Trump call:

Chinese President Xi Jinping spoke by phone with U.S. President Donald Trump. The two leaders had a candid and in-depth exchange of views on China-U.S. relations and issues of mutual concern, and provided strategic guidance for the stable development of bilateral relations in the next stage. The call was pragmatic, positive, and constructive.

Xi Jinping noted that during World War II, China and the United States were allies who fought side by side. Not long ago, China held a grand ceremony to mark the 80th anniversary of the victory in the Chinese People’s War of Resistance Against Japanese Aggression and the World Anti-Fascist War, inviting descendants of members of the American Flying Tigers to watch the military parade from Tiananmen. The Chinese people will not forget the valuable support provided by the United States and other anti-fascist allies to China’s war effort. On the basis of honoring the fallen and remembering history, we should cherish peace and create the future.

Xi stressed that China-U.S. relations are extremely important. China and the United States can complement each other, prosper together, benefit both peoples, and bring gains to the world. To realize this vision, both sides must move toward each other and make efforts to achieve mutual respect, peaceful coexistence, and win-win cooperation. The recent consultations between the two teams reflected the spirit of equality, respect, and reciprocity, and can continue to properly handle prominent issues in bilateral relations to strive for mutually beneficial outcomes. The U.S. should avoid unilateral trade restrictions to prevent undermining the achievements already reached through multiple rounds of talks. On the issue of TikTok, China’s position is clear: the Chinese government respects corporate wishes and is pleased to see enterprises conduct sound commercial negotiations on the basis of market principles, reaching solutions that comply with Chinese laws and regulations and balance interests. China hopes the U.S. will provide an open, fair, and non-discriminatory business environment for Chinese enterprises investing in the United States.

Trump said that China’s parade commemorating the 80th anniversary of victory in the war of resistance was spectacular. U.S.-China relations are the most important bilateral relationship in the world. Cooperation between the two countries can achieve many major undertakings conducive to world peace and stability. The United States hopes to maintain a long-term, good, and great relationship with China. The U.S. also hopes to promote bilateral economic and trade cooperation, will support the teams’ consultations, and properly resolve the TikTok issue. The U.S. is willing to work together with China to safeguard world peace.