China's Leaders Gather for Key Strategy Session as Challenges Grow

Beijing this week will host China's carefully orchestrated annual strategy meetings known as "Two Sessions". Pedro PARDO / AFP
Beijing this week will host China's carefully orchestrated annual strategy meetings known as "Two Sessions". Pedro PARDO / AFP
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China's Leaders Gather for Key Strategy Session as Challenges Grow

Beijing this week will host China's carefully orchestrated annual strategy meetings known as "Two Sessions". Pedro PARDO / AFP
Beijing this week will host China's carefully orchestrated annual strategy meetings known as "Two Sessions". Pedro PARDO / AFP

China's leaders are set to unveil strategies to confront challenges that include sluggish consumption, a shrinking population and shifting geopolitical landscapes when they gather in Beijing this week for the annual Two Sessions political meeting.

Thousands of delegates from across China will convene for a carefully orchestrated affair in Beijing's Great Hall of the People, largely to rubber-stamp decisions by the ruling Communist Party under leader Xi Jinping.

The nation's 15th Five-Year Plan -- a blueprint for the world's second-largest economy through to 2030 -- will also be released.

With most of the decisions already made, the Two Sessions are mainly a talking shop with little room for spontaneity or off-the-cuff comments.

However, they do provide a rare glimpse into the party's priorities on matters ranging from the economy to defense and foreign policy.

This year's gathering begins on Wednesday with the start of the Chinese People's Political Consultative Conference, a political advisory body.

It is generally overshadowed by the next day's opening of the National People's Congress, China's parliament, at which Premier Li Qiang will outline key growth targets.

China's economy expanded by five percent in 2025, in line with Beijing's target but one of the slowest rates in decades.

Analysts expect this year's target to be set even lower -- between 4.5 and five percent -- with 14 provinces reducing their GDP targets in recent weeks compared to 2025.

China's leaders say the country's economic model must shift towards consumption-based growth, rather than traditional drivers, including production and exports.

But factors such as the flagging property market, deflation and youth unemployment have left consumers tightening their purse strings.

Over-production spurred by state support and low demand, as well as international trade tensions, have also loomed over industrial output.

- 'Double down' -

Beijing's five-year plan for 2026-2030 will aim to address such issues, with officials vowing it will "create new demand through new supply and provide strong innovative measures".

Analysts, however, are skeptical.

"The thrust of it is to double down on the direction of travel Xi had already set," Steve Tsang, director of the SOAS China Institute, told AFP.

Expected measures are "unlikely to address the fundamental problem behind weak private consumption", he said.

The plan is expected to concentrate on high-tech manufacturing, green transition and supply chain resilience.

"This signals a shift away from debt-fueled expansion toward innovation-led growth", as well a response to trade tensions and global uncertainty, said Sarah Tan of Moody's Analytics.

However, strengthening social safety nets and boosting incomes, as well as addressing the long-running property crisis, would lead to "a more durable revival", she said.

- Priorities and credibility -

China is also facing serious demographic challenges: its population has shrunk for three years in a row.

Top leaders have pledged more childcare relief, including subsidies of around $500 per year for every child under the age of three -- but the measures so far have done little to boost births.

The Two Sessions is tightly controlled, but delegates in the past have used the opportunity to try to push pet policies, particularly social measures.

But when the "overarching objective politically is security... there's no desire to be innovative", former US defense official Drew Thompson said.

"So they're kind of stuck."

China's defense budget will also be announced, with the military reeling from a deep and long-running anti-corruption campaign.

The announcement in January that top general Zhang Youxia was under investigation sent shockwaves through defense observers, who saw it as a consolidation of power in Xi's hands.

However, the saga is not expected to feature heavily at the Two Sessions, according to SOAS' Tsang.

Ultimately, delegates are trying to turn the tide of low public confidence, analysts noted.

"There are some serious societal challenges that the party has to adapt to and the tools they're using are pretty traditional ones," Thompson said.

Tan from Moody's Analytics added that "credibility will rest on whether structural reforms, meaningful support for households and sustained fiscal backing follow the rhetoric".



Putin Threatens Retaliatory Seizures of European Ships

Russian President Vladimir Putin holds a meeting aboard the Guards missile cruiser Varyag during the final stage of the Pacific Fleet's exercises off the coast of Sakhalin region, Russia, 12 August 2026. (EPA/Gavriil Grigorov Kremlin / Pool)
Russian President Vladimir Putin holds a meeting aboard the Guards missile cruiser Varyag during the final stage of the Pacific Fleet's exercises off the coast of Sakhalin region, Russia, 12 August 2026. (EPA/Gavriil Grigorov Kremlin / Pool)
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Putin Threatens Retaliatory Seizures of European Ships

Russian President Vladimir Putin holds a meeting aboard the Guards missile cruiser Varyag during the final stage of the Pacific Fleet's exercises off the coast of Sakhalin region, Russia, 12 August 2026. (EPA/Gavriil Grigorov Kremlin / Pool)
Russian President Vladimir Putin holds a meeting aboard the Guards missile cruiser Varyag during the final stage of the Pacific Fleet's exercises off the coast of Sakhalin region, Russia, 12 August 2026. (EPA/Gavriil Grigorov Kremlin / Pool)

Russian President Vladimir Putin on Wednesday threatened to seize ships belonging to European countries in retaliation for plans to sell off cargo seized from Russian "shadow fleet" vessels.

Several European companies have intercepted ships carrying Russian oil in contravention of European sanctions targeting the vital revenue source.

New sanctions passed last month permit EU members to sell the oil or any other cargo seized from the ships.

Moscow has bristled at the moves, with Putin calling it "piracy and banditry".

"We will be forced to respond in kind," the Kremlin chief said while overseeing naval drills in Russia's Far East.

Moscow would act "wherever we ourselves deem necessary and appropriate -- anywhere," he added.

Swedish court documents obtained by AFP earlier in August showed Stockholm will transfer to Kyiv a seized Russian ship suspected of transporting grain from occupied Ukraine.

Putin was speaking aboard the Russian cruiser Varyag off the island of Sakhalin, where Russia's navy was conducting drills.

The exercises come a week before joint US-South Korean war games, designed to simulate a possible invasion from North Korea.

Tensions are high in the region amid accusations from Kyiv and Seoul that Pyongyang and Moscow are further intensifying their military cooperation.


Pakistan Interior Minister in Iran to Discuss Regional Security

A handout photo made available by the Iranian Foreign Ministry Office shows Iranian Foreign Minister Abbas Araghchi (R) meeting with Pakistan's Minister of Interior Mohsin Naqvi in Tehran on August 11, 2026. (Iran Foreign Ministry / AFP)
A handout photo made available by the Iranian Foreign Ministry Office shows Iranian Foreign Minister Abbas Araghchi (R) meeting with Pakistan's Minister of Interior Mohsin Naqvi in Tehran on August 11, 2026. (Iran Foreign Ministry / AFP)
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Pakistan Interior Minister in Iran to Discuss Regional Security

A handout photo made available by the Iranian Foreign Ministry Office shows Iranian Foreign Minister Abbas Araghchi (R) meeting with Pakistan's Minister of Interior Mohsin Naqvi in Tehran on August 11, 2026. (Iran Foreign Ministry / AFP)
A handout photo made available by the Iranian Foreign Ministry Office shows Iranian Foreign Minister Abbas Araghchi (R) meeting with Pakistan's Minister of Interior Mohsin Naqvi in Tehran on August 11, 2026. (Iran Foreign Ministry / AFP)

Pakistan's interior minister is visiting Iran to discuss regional security, stability and other developments, the Pakistani foreign office said Wednesday, as Islamabad tries to mediate a resolution to the Middle East war.

Mohsin Naqvi, previously involved in mediation efforts between Iran and the US, is known to be close to the powerful head of the Pakistani army, Asim Munir.

Iranian state news agency IRNA reported late Tuesday that Naqvi met with Iranian President Masoud Pezeshkian, Foreign Minister Abbas Araghchi and Interior Minister Eskandar Momeni.

"He is discussing bilateral relations, security, regional security and stability, and constructive engagement amongst the parties in the region and regional developments," Pakistani foreign ministry spokesman Tahir Andrabi told reporters in Islamabad.

The Iranian government's website said Naqvi conveyed to Pezeshkian "a message from the Pakistani prime minister and the chief of the army", without specifying its content.

Tehran insists on retaining control of the Strait of Hormuz after the war and wants to charge fees for passage, repeatedly striking ships it accuses of attempting to circumvent its preferred route. The US has imposed a rival blockade on Iranian ports.

Attacks in the waterway, which was free to transit before the war, led to the collapse of an April ceasefire, and mediators have urged both sides to return to the terms of a subsequent June memorandum that set out a path for peace talks.

Last week Iran said it had agreed a route with neighboring Oman for ships transiting the strait and was finalizing arrangements for jointly managing the strategic waterway.

On Tuesday the US military announced that it had fired on a Panama-flagged cargo ship that attempted to break the American blockade of Iran's ports.


North Korea Fires Missile Ahead of Major US-South Korea Drills

People watch a news broadcast on a television screen showing a report on a missile launch, at a railway station in Seoul, South Korea, 12 August 2026. (EPA)
People watch a news broadcast on a television screen showing a report on a missile launch, at a railway station in Seoul, South Korea, 12 August 2026. (EPA)
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North Korea Fires Missile Ahead of Major US-South Korea Drills

People watch a news broadcast on a television screen showing a report on a missile launch, at a railway station in Seoul, South Korea, 12 August 2026. (EPA)
People watch a news broadcast on a television screen showing a report on a missile launch, at a railway station in Seoul, South Korea, 12 August 2026. (EPA)

North Korea fired a ballistic missile on Wednesday toward the sea off the Korean peninsula's east coast, South Korean and Japanese authorities said, days ahead of major joint military exercises by Seoul and Washington long denounced by Pyongyang.

The missile was launched from the North's Wonsan area at about 6 a.m. (2100 GMT Tuesday), South Korea's Joint Chiefs of Staff (JCS) said, six days after North Korea fired another ballistic missile from the same area.

The launch came ahead of South Korean and US military drills, dubbed Ulchi Freedom Shield, set to run from August 17 to August 27, aimed at countering Pyongyang's evolving nuclear and weapons capabilities.

Hong Min, a senior researcher at the Korea Institute for National Unification in Seoul, said the launch ‌was likely part of ‌North Korea's existing weapons development schedule, but the timing could also have been ‌selected ⁠to send a ⁠message ahead of the exercises.

"Even if it was a test of a weapon under development, choosing when to conduct it requires a political decision," Hong said.

There was no immediate statement from North Korea on the Wonsan launch, but Pyongyang on Wednesday afternoon criticized the nuclear ambitions of South Korea and Japan.

South Korea said North Korea also fired a ballistic missile from Wonsan on August 6, but Pyongyang did not report that launch in state media. Hong said that test may have failed to achieve its intended objective.

North Korea's series of tests this year has featured short-range ballistic missiles, artillery rockets and other tactical weapons.

Wednesday's ⁠launch was its 11th suspected ballistic missile test in 2026, according to South Korean ‌assessments.

South Korean and Japanese defense authorities said the missile flew about 700 ‌km (435 miles).

Seoul's Joint Chiefs of Staff did not identify it as a short-range ballistic missile, saying authorities would conduct a detailed ‌analysis.

The omission leaves open the question of what type of missile it was, analysts said. Ballistic missiles with ‌ranges of 300 km to 1,000 km (186 miles to 620 miles) are generally classified as short-range.

Hong said the range, trajectory and launch site suggested it may have been a type of hypersonic missile, though a submarine-launched missile was also possible.

CONDEMNATION AND HEIGHTENED TENSIONS

South Korea and Japan both condemned the launch.

"Japan lodged a strong protest with North Korea through diplomatic channels at the Japanese Embassy ‌in Beijing and strongly condemned the action," Japanese Defense Minister Shinjiro Koizumi told reporters.

South Korea's Office of National Security convened an emergency meeting and expressed concern over North Korea's continued ⁠ballistic-missile launches following the ⁠August 6 firing. It urged Pyongyang to halt provocations that violate UN Security Council resolutions.

South Korea's military said it was maintaining readiness to respond "overwhelmingly" to any provocation under its combined defense posture with the United States.

The US Indo-Pacific Command said it was consulting closely with allies and partners, adding that its initial assessment was that the launch posed no immediate threat to US personnel or territory, or to its allies.

On Tuesday, Ukrainian President Volodymyr Zelenskiy said Moscow used North Korean ballistic missiles during a Russian attack that killed seven workers at a steel plant in the southeastern city of Zaporizhzhia.

In a statement, a North Korean Foreign Ministry official responsible for South Korean affairs said Seoul's plans to develop nuclear-powered submarines would heighten instability in the region, for a "serious challenge" to the North's security.

Pyongyang needed the capability to counter its adversaries' military moves with retaliatory strikes that would make their "survival and recovery impossible", the statement added.

In a separate commentary state news agency KCNA accused Japan of seeking nuclear weapons under the guise of peaceful use of atomic energy, citing its nuclear power program and debate among Japanese politicians over nuclear armament.