Domestic-international dual circulation (simplified Chinese: 国内国际双循环; traditional Chinese: 國內國際雙循環; pinyin: guónèi guójì shuāng xúnhuán) is a Chinese government strategy to reorient the country's economy by prioritizing domestic consumption ("internal" or "domestic circulation") while remaining open to international trade and investment ("external" or "international circulation").[1][2][3] The first academic study on dual circulation defined it as "the domestic consumption-driven economic rebalancing to achieve sustainable economic development".[4]

The economic policy of dual circulation was put forward on 14 May 2020 by the Politburo Standing Committee of the Chinese Communist Party (CCP)[5] and later revised by CCP General Secretary Xi Jinping to stress prioritizing "internal circulation".[6] Dual circulation involves expanding domestic demand, focusing on the domestic market, improving the country's capacity for innovation, reducing dependence on foreign markets, and at the same time remaining open to the outside world.[2][7][8]


The intellectual predecessor of dual circulation was the "great international circulation", a strategy of economic growth through export-oriented production, articulated by Wang Jian during the era of former paramount leader Deng Xiaoping.[4][9][10]

In 2020, the COVID-19 pandemic brought a global economic downturn and a decline in demand. Along with the China–United States trade war and American trade restrictions against Huawei and other Chinese firms, this has forced the Chinese government to adopt a domestic focus.[11] In the Chinese view, these trends towards anti-globalization, populism, and protectionism in Western countries means that China should expand its domestic markets and economic self-reliance.[12]

On 14 May 2020, the CCP Politburo Standing Committee proposed a "new development program of mutual benefit through domestic-international dual circulation".[13] On 23 May 2020, at the Chinese People's Political Consultative Conference 13th national committee, Xi Jinping said the country needed a development program that "takes the domestic market as the mainstay while letting internal and external markets boost each other".[8][14] On 4 November 2020, during his keynote speech by video at the opening ceremony for the third China International Import Expo, Xi said that this policy "is not any kind of closed-off domestic circulation, but rather an increasingly open domestic-international dual circulation, not just for China's own development needs, but also to benefit the people of all countries".[15] Assistant head of the CCP Central Financial and Economic Affairs Commission office Han Wenxiu said that "the proposal for a new development program that takes the domestic market as the mainstay while letting internal and external markets boost each other is the CCP's practical application of the objective laws of economic development. This is a proactive step, not a passive response; a long-term strategy, not an interim measure."[16]

Xi states that there are two guiding principles for China's approach to international engagement under its dual circulation strategy.[17]: 133  The first principle is that China should actively cooperation with all countries and regions that are willing to cooperate with it in order to form a diversified pattern of cooperation.[17]: 123  The second is that the more China opens up to the outside world, the more it must also pay attention to its own security, focus on its competitiveness, and manage opening up to mitigate risk.[17]: 133 

Implementation and impact

There are two prongs to the dual circulation strategy. First, it seeks to rely more on China's domestic consumers.[18]: 160  Second, it seeks to innovate more domestically developed technology and thereby reduce China's reliance on western technology.[18]: 160 

Dual circulation has recalibrated China's industrial policy to place a renewed emphasis on state-led growth and self-reliance based on China's domestic market of 1.4 billion consumers,[19] which include over 400 million middle income consumers.[12] In an effort to facilitate the strategy by closing technology gaps, China spent 2.5% of its GDP on research and development during the Thirteenth Five Year Plan of 2016–2020.[19]

Dual circulation is a key part of China's 14th Five-Year Plan (2021–2025).[20][3] Proposals for implementing the policy include government support for domestic technology companies and working to attract more foreign investment. Analyst Wang Wen [zh] of the Chongyang Institute for Financial Studies speculated that it would include government support for the service and energy sectors.[1]


Some observers say the dual circulation plan is not that different from previous Chinese government efforts to refocus the economy.[1] As early as 2006, a government work report described a "strategy of expanding domestic consumption...and strengthening the role of consumption in fueling economic development".[21] Julian Gewirtz suggested that the "dual circulation" slogan was introduced to "force focus, mobilization and prioritization".[1]

Analysts said that the strategy would involve supporting domestic businesses and reducing China's dependence on imports, including for energy, microchips, and other technology.[1][9] Economist Yu Yongding said that a key part of the project should be ensuring China's food and energy security.[10] Economist Yao Yang described the policy as a response to worsening China–United States relations, saying that "China needs to prepare for the worst-case scenario".[1]

Dual circulation also involves growing the Chinese middle class in order to increase domestic consumption. Economist Michael Pettis said that the plan would require transferring wealth from the government to private citizens, which would not be easy. According to the South China Morning Post, in late 2020 it remained "unclear whether China is ready to make such deep-rooted changes".[2]

The Economist summarized the strategy as "keeping China open to the world (the 'great international circulation'), while reinforcing its own market (the 'great domestic circulation')". More specifically, The Economist said that dual circulation involves making the Chinese economy more open to foreign companies in order to make them dependent on China, which in turn would give the Chinese government more geopolitical leverage.[9]

In 2021, a team of researchers at Nanjing University of Information Science and Technology presented the first academic study on "Dual Circulation".[4] It identified key factors responsible for it, and presented its first comprehensive definition.

See also


  1. ^ a b c d e f Buckley, Chris (7 September 2020). "Xi's Post-Virus Economic Strategy for China Looks Inward". The New York Times. Retrieved 9 March 2021.
  2. ^ a b c Tang, Frank (19 November 2020). "What is China's dual circulation economic strategy and why is it important?". South China Morning Post. Retrieved 10 March 2021.
  3. ^ a b Jin, Keyu (2023). The New China Playbook. New York: Viking. pp. 250–251. ISBN 9781984878281. This is reflected in the concept of "dual circulation" that constitutes a central component of China's fourteenth Five-Year Plan, of two engines simultaneously propelling its economy. One keeps China open to the world ("international circulation"), and the other develops self-reliance by developing its own market ("domestic circulation"), in ways that reinforce each other.
  4. ^ a b c Javed, Saad Ahmed; Bo, Yu; Tao, Liangyan; Dong, Wenjie (2021-01-01). "The 'Dual Circulation' development model of China: Background and insights". Rajagiri Management Journal. 17: 2–20. doi:10.1108/RAMJ-03-2021-0016. ISSN 2633-0091.
  5. ^ "高层会议首提"国内国际双循环"新发展格局, 释放哪些重磅信号?". Yicai Global. Shanghai Media Group. Archived from the original on 2020-10-27. Retrieved 2020-10-20.
  6. ^ Yao, Kevin (9 September 2020). "What we know about China's 'dual circulation' economic strategy". Reuters. Retrieved 14 March 2021.
  7. ^ "国际锐评丨打造"双循环"的中国经济有力回击"脱钩"谬论". 央視新聞. Archived from the original on 2020-10-24. Retrieved 2020-10-20.
  8. ^ a b "看习近平这几次重要讲话,弄懂"大循环""双循环"". Xinhua. Archived from the original on 2020-09-24. Retrieved 2020-10-20.
  9. ^ a b c "China's "dual-circulation" strategy means relying less on foreigners". The Economist. 7 November 2020. Retrieved 9 March 2021.
  10. ^ a b Yu, Yongding (22 August 2020). "【余永定】 怎样实现从"国际大循环"到 "双循环"的转变?". Retrieved 9 March 2021.
  11. ^ "習近平提「雙循環」戰略:經濟重心向內轉". The New York Times. 21 September 2020. Archived from the original on 2021-01-04. Retrieved 2020-10-21.
  12. ^ a b CPC Futures The New Era of Socialism with Chinese Characteristics. Frank N. Pieke, Bert Hofman. Singapore: National University of Singapore Press. 2022. p. 123. ISBN 978-981-18-5206-0. OCLC 1354535847.((cite book)): CS1 maint: others (link)
  13. ^ "如何理解"国内大循环""国内国际双循环"". 中国经济时报. Archived from the original on 2020-10-26. Retrieved 2020-10-20.
  14. ^ "Understanding 'dual circulation' and what it means for world". China Daily. Retrieved 10 March 2021.
  15. ^ "在第三届中国国际进口博览会开幕式上的主旨演讲". Xinhua. 2020-11-05. p. 2. Retrieved 2020-11-07.[permanent dead link]
  16. ^ "中财办韩文秀:构建新发展格局,还要深入参与国际循环". 新浪. 2020-10-30. Archived from the original on 2020-11-03. Retrieved 2020-11-11.
  17. ^ a b c Tsang, Steve; Cheung, Olivia (2024). The Political Thought of Xi Jinping. Oxford University Press. ISBN 9780197689363.
  18. ^ a b Brown, Kerry (2023). China Incorporated: The Politics of a World Where China is Number One. London: Bloomsbury Academic. ISBN 978-1-350-26724-4.
  19. ^ a b Zhao, Suisheng (2023). The Dragon Roars Back: Transformational Leaders and Dynamics of Chinese Foreign Policy. Stanford, California: Stanford University Press. pp. 225–226. doi:10.1515/9781503634152. ISBN 978-1-5036-3088-8. OCLC 1331741429.
  20. ^ "Xiplomacy: Xi's vision of China's new development paradigm attracts global attention". Xinhua. 8 March 2021. Retrieved 9 March 2021.
  21. ^ "Government Work Report (2006)". China Daily. 2 March 2007. Retrieved 9 March 2021.