Balancing Act

“If there is an overall theme to China's 12th Five Year Plan, it will be in implementing policies that will maintain political stability throughout the country,” says Michelle Taylor, the Greater China head of Orrick Herrington & Sutcliffe. Zhan Hao, a partner at Grandall Legal Group agrees: “Nowadays, the development of the Chinese economy is not stable, and the government's reasonable and timely control is necessary.”

The proposal of the country's 12th Five Year Plan was released on October 18 2010 and among the key concerns it tackles are environmental issues, income disparity between rural and urban residents, developing harmonious labour relations and regulating housing prices. “The 12th Five Year Plan confirms the path that China is currently on,” says Maarten Roos, the managing partner of R&P China Lawyers. “It is, among others, emphasising the need to continue reforms that have been started in recent years.” These include reforms in the tax and labour spaces, the latter which Roos believes will “force more and more companies to actively work on a new, long-term strategy to deal with their employees”.