From a business perspective, China will continue to want and need engagement with foreign companies. Beijing policymakers have no illusions of self-sufficiency.

Foreign companies in China seen to be directly contributing to the success of the dual circulation strategy will find an amenable and frequently profitable business environment. But China will be more demanding about the terms of the engagement and, for some foreign companies in China, life will get tougher.

What does this mean in real-world terms? If you cannot draw a straight line between your corporate activities in China and China’s specifically delineated development goals, you could be on thin ice.

To be clear, no one will be thrown out. Instead, subtle and not-so-subtle legal, regulatory and market measures will be used to make it more onerous for less-favoured companies to conduct business in China. More foreign companies will decide the juice is not worth the squeeze and depart.

To an extent, these dynamics are well understood and the game is already being played. Foreign business organisations in China have bent over backwards for years to show the synergies between their corporate members and China’s development objectives.

Voluminous reports are prepared and executives speechify on the research and development they conduct in China and the technology they transfer to local partners. The pressure on foreign companies to “justify their existence” in China will intensify as the preference for domestic alternatives becomes more explicit.

China’s leadership has accurately diagnosed a fundamental shift in the external policy environment and is responding with logical policies to advance national interests. Through the dual circulation strategy, it seeks to make China less dependent on the rest of the world while maximising the leverage associated with the world’s dependence on China.

The implications of China’s strategy need to be clearly understood by foreign governments and companies. And they will need to be just as insightful and pragmatic as the Communist Party in developing strategies to account for current realities and to protect their interests. A new era has begun.