{"id":65336,"date":"2022-10-24T04:16:11","date_gmt":"2022-10-24T04:16:11","guid":{"rendered":"https:\/\/tahrir2day.com\/news\/2022\/10\/24\/what-we-just-learned-about-chinas-economy\/"},"modified":"2022-10-24T04:16:11","modified_gmt":"2022-10-24T04:16:11","slug":"what-we-just-learned-about-chinas-economy","status":"publish","type":"post","link":"https:\/\/tahrir2day.com\/news\/2022\/10\/24\/what-we-just-learned-about-chinas-economy\/","title":{"rendered":"What we just learned about China’s economy"},"content":{"rendered":"
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The Chinese Communist Party Congress ended Sunday with the standard confirmation of Xi Jinping’s historic third five-year term.<\/b><\/p>\n<\/div>\n

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Also in the spotlight was the man appointed as his new deputy, Li Qiang.<\/p>\n<\/div>\n

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As a loyalist to Mr. Xi, he is now on course to become prime minister and take on the task of managing the world’s second largest economy.<\/p>\n<\/div>\n

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Meanwhile, China on Monday released a series of economic numbers that were delayed from the previous week.<\/p>\n<\/div>\n

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China’s economy faces a number of challenges at home and abroad – including Beijing’s zero-Covid policy and the trade dispute with the US.<\/p>\n<\/div>\n

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What have we learned about the state of the country’s economy over the past week?<\/p>\n<\/div>\n

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On Monday, just a day after the conclusion of the congress, official figures showed that China’s economy grew 3.9% in the July-September quarter from the same period last year, beating estimates.<\/p>\n<\/div>\n

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It marked a strong rebound from 0.4% growth in the previous three months when Shanghai was on lockdown.<\/p>\n<\/div>\n

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The publication of the figures was postponed during the congress without a reason given for the delay. This led some China watchers to think they might be hinting at weakness in the economy.<\/p>\n<\/div>\n

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\u201cThe 20th Party Congress did not show any new directions in economic policy. Whether the macroeconomic approach will deliver the kind of growth China desires remains to be seen,\u201d Bert Hofman of the National University of Singapore’s East Asian Institute told the BBC.<\/p>\n<\/div>\n

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While recent growth figures may seem high compared to most western economies, they are well below the growth rate China has recorded for decades and still a long way from the 5.5% target for 2022 set in March.<\/p>\n<\/div>\n

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Since then, the Politburo – the top political decision-making body of the ruling Chinese Communist Party – has signaled it could miss that target after major cities went into full or partial lockdown.<\/p>\n<\/div>\n

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  • Xi Jinping’s party has only just begun<\/li>\n
  • Who are the men now running China?<\/li>\n<\/ul>\n<\/div>\n<\/div>\n
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    Some observers say Mr Xi’s election to the Politburo Standing Committee – China’s equivalent of a presidential cabinet – has shown that he values \u200b\u200bloyalty over expertise and experience.<\/p>\n<\/div>\n

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    His choice as the new deputy party leader was Li Qiang.<\/p>\n<\/div>\n

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    He is expected to become China’s premier next year and take on the role of managing China’s economy, although he has no work experience in the central government. <\/p>\n<\/div>\n

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    Li Qiang is also just five years away from the usual retirement age for top Chinese politicians.<\/p>\n<\/div>\n

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    However, he was closely involved in managing the local economy of Zhejiang Province and Shanghai, and played a key role in establishing a massive Tesla factory in Shanghai.<\/p>\n<\/div>\n

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    \u201cConsidering that, Li Qiang would actually be a perfect candidate for the job. He’s also a strong supporter of President Xi, which means the decision-making process is likely to be much more efficient than before, assuming those decisions are right “ones,” said Dan Wang, chief economist at Hang Seng Bank China.<\/p>\n<\/div>\n

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    Nick Marro of the Economist Intelligence Unit (EIU) said: “The dilution of this previously balanced relationship between the premier and the president will continue under Xi’s third term. But the erosion of those internal controls will exacerbate the risks and consequences of policy deviation.”<\/p>\n<\/div>\n

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    The premier is the deputy of the ruling Chinese Communist Party. They play an important role in controlling the economy by coordinating the work of the ministries and the central bank.<\/p>\n<\/div>\n

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    Li Qiang’s predecessor, Li Keqiang, who is seen as more moderate, has been in the position for nearly a decade and is now expected to retire after his current term expires next March.<\/p>\n<\/div>\n

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    There were hopes ahead of Congress that China could relax its strict zero-Covid policy, which has hampered economic growth.<\/p>\n<\/div>\n

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    A day before the start of the event, Communist Party spokesman Sun Yeli expressed his support for the policy, saying, “We firmly believe that the light is ahead and perseverance is victory.”<\/p>\n<\/div>\n

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    These sentiments were echoed by Mr. Xi in his opening speech. He said Beijing had launched a “people’s war to stop the spread of the virus” and “protected people’s health and safety as much as possible.”<\/p>\n<\/div>\n

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    Yun Sun, a senior fellow at the Stimson Center think tank in Washington DC, believes China will soon begin the “incremental process” of dropping zero-Covid.<\/p>\n<\/div>\n

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    “It is known that China is planning to reopen and will boost the growth of trade. China is trying to find a middle ground between control and growth. It’s not either or,” she told the BBC. <\/p>\n<\/div>\n

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    Meanwhile, Hang Seng Bank’s Dan Wang believes that “there is a general consensus that this policy will be maintained over the long term.”<\/p>\n<\/div>\n

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    “For the Chinese government, there is next to no tolerance for a death rate above zero directly caused by Covid,” she said. <\/p>\n<\/div>\n

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    There are also growing concerns that China could shut itself off from the global economy.<\/p>\n<\/div>\n

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    One of the biggest hurdles China faces is its “frayed ties” with the US, said the EIU’s Mr Marro.<\/p>\n<\/div>\n

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    \u201cThe recent US export controls pose an existential crisis not only for China’s technological ambitions, but also for parts of its domestic technology sector. It will be difficult for China to meet these challenges as many of them relate to … fundamental differences in human rights and democratic values,” he added.<\/p>\n<\/div>\n

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    “Facing the challenges ahead, the economic management team for Xi’s next term must be highly competent and experienced in economic management and reform,” said Mr. Hofman.<\/p>\n<\/div>\n

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    However, in a speech on Sunday, Mr Xi said his country was determined to remain open to international trade.<\/p>\n<\/div>\n

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    “China cannot develop without the world, and the world needs China too.” <\/p>\n<\/div>\n

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    “After more than 40 years of tireless reform and opening-up efforts, we have achieved two miracles – rapid economic development and long-term social stability,” he added.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

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