as xi ascends will economic reforms finally take off
Last Updated : GMT 06:49:16
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 06:49:16
Arab Today, arab today

As Xi ascends, will economic reforms finally take off?

Arab Today, arab today

Arab Today, arab today As Xi ascends, will economic reforms finally take off?

Chinese President Xi Jinping
Beijing - AFP

As Chinese President Xi Jinping prepares for a second five-year term, foreign investors will be watching for any sign of his long-promised reforms to further open up the world's second-largest economy.

Xi will likely lay out his future economic policies on Wednesday, when he opens a five-yearly Communist Party congress that will extend his tenure as general secretary.

While he is expected to fill top posts with loyalists, analysts are divided as to whether he will use his increased powers to let the market rule or keep the state firmly in charge of the economy.

Xi has sought to cast himself as a champion of globalisation as the United States retreats behind President Donald Trump's "America First" policy.

But foreign companies complain that his words have not been backed by deeds, as the state retains control over the economy.

US and European firms report being barred from certain sectors and forced to share their technologies with local competitors.

The EU Chamber of Commerce in China summed up the exasperation as "promise fatigue".

Underperforming state-owned enterprises, which have saddled the economy with huge debts and overcapacity exceeding domestic demand, have been propped up or merged into massive companies.

- Premier sidelined -

Private firms, meanwhile, are being subjected to closer control by the Communist Party, via cells it deploys inside companies.

While the government is seeking to turn toward a consumption-based economy, the state has continued to fuel growth through an accumulation of debt that, according to the IMF, is on a "dangerous trajectory".

Congress spokesman Tuo Zhen said Tuesday that China "will not slow the pace" of reforms, but he admitted there were still "tough problems to solve" such as "systemic obstacles".

But some analysts are not convinced by such public pronouncements.

"There has been general disappointment on economic performance and direction," said Christopher Balding, economics professor at Peking University in the southern city of Shenzhen.

"China is significantly more centralised than it was even five years ago. At this point, it would be very difficult for anyone to make a serious argument that China is seriously interested in opening up economically," he told AFP.

When Xi took office five years ago, his premier Li Keqiang was seen as the man in charge of shepherding the economy.

Li had promised "fair treatment" to foreign firms, a larger role for the market and structural reforms in favour of the private sector.

But analysts say the premier has been sidelined as Xi has further centralised power around himself.

Li "struggled to rally support around his reformist views" and curb state-owned enterprises, but he "has clearly not been a very influential premier", according to the Economist Intelligence Unit.

- ' Tough decisions' -

Supported by his economic adviser Liu He, Xi chairs the commission leading financial and economic affairs as well as a powerful new committee devoted to reforms.

In July Xi called for "stronger financial regulation" to contain "systemic financial risks" -- raising concern among analysts that this could stifle much-needed reforms.

"Xi Jinping has increasingly stressed the importance of 'stability' on all fronts," Louis Kuijs of Oxford Economics said in a note.

"Bold, potentially disruptive economic reform and forceful deleveraging are not consistent with stability."

But some are optimistic that Xi will use his new mandate and increased powers after the week-long congress to accelerate reforms.

"Mr Xi's strengthened position will give his administration the authority to take the tough decisions necessary to tackle China's debt overhang," according to the Economist Intelligence Unit.

Julian Evans-Pritchard, China economist at Capital Economics, said the implementation of reform is "likely to accelerate" after the congress if Xi emerges in a stronger position.

However, the reforms adopted so far have failed to address the underlying causes of state sector inefficiency, with underperforming companies not allowed to declare bankruptcy and leave the market, Evans-Pritchard said.

"But given Xi's reluctance to relinquish state control over key parts of the economy," he said, "China's structural problems are likely to remain unresolved."

 

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

as xi ascends will economic reforms finally take off as xi ascends will economic reforms finally take off

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

as xi ascends will economic reforms finally take off as xi ascends will economic reforms finally take off

 



GMT 12:47 2016 Thursday ,01 September

'La La Land' musical masterpiece dazzles Venice film fest

GMT 12:42 2017 Monday ,20 February

Dalia al-Behairy begins 'Yawmiyat Zoga Mafrosa'

GMT 19:01 2017 Wednesday ,30 August

Oil prices down as US reels from Harvey

GMT 04:19 2017 Monday ,08 May

National forces attack mercenaries in Taiz

GMT 19:21 2017 Sunday ,07 May

Iranian Film Week opens in Baghdad

GMT 21:33 2017 Sunday ,30 July

Arab Quartet meeting kicks off in Bahrain

GMT 17:17 2016 Friday ,07 October

Aleppo bleeds as US and Russia spar

GMT 12:03 2015 Monday ,21 December

Nepal protester killed in constitutional crisis clash

GMT 09:47 2016 Thursday ,22 December

Trump vows to cut F-35 spending, as leaked memo

GMT 21:44 2017 Friday ,15 December

King establishes Hawar Development Committee

GMT 20:57 2017 Tuesday ,16 May

Naval Forces rescue 23 tourists in Hurghada

GMT 12:56 2017 Monday ,11 December

Lyon leave it late, Balotelli with Nice winner

GMT 06:18 2017 Thursday ,19 October

Russian delegation meets with Julphar chairman

GMT 21:20 2017 Monday ,23 October

Nasr, delegation of London Stock Exchange

GMT 14:40 2012 Saturday ,10 March

Magdy Al-Galad steps down

GMT 09:47 2017 Sunday ,12 March

Cat Camp in New York attracts cat lovers

GMT 14:57 2016 Friday ,09 September

Madonna, Ritchie settle child custody dispute

GMT 23:52 2017 Monday ,18 September

UAE economic growth boosting logistics sector
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday