By Willy Wo-Lap Lam July 18, 2022
The relentless cascade of bad economic news in China has not only cast doubt on the governance ability of the Xi Jinping leadership, but has also called into question the long-term viability of the Chinese economic model, which stresses maintaining party-state control of the market and limiting international access to sensitive sectors such as finance.
Given supreme leader Xi’s Maoist-style and statist approach to the economy as well as his insistence on a “zero-tolerance” pandemic policy, confidence in China’s future among its neighbors and trading partners is tipped to drop even further, especially if Xi realizes his long-held ambition and gains an unprecedented third or even fourth five-year term as “core of the Chinese Communist Party (CCP) leadership” at the upcoming 20th Party Congress. Xi has undoubtedly been forced to allow Premier Li Keqiang – a political foe and leader of the opposition Communist Youth League (CYL) faction – and technocrats in the central-government apparatus to assume day-to-day management of the economy.
Due to his dented authority – and the threats to stability posed by the growing rebelliousness of China’s 400 million-strong middle class who have grown increasingly frustrated with Beijing’s problematic governance record since the early 2010s – the 69-year-old Xi may be forced to make pledges to adopt a more pro-market stance after the Party Congress. The supreme leader might also be obliged to appoint more members of the “anti-Xi faction” to the Central Committee and the all-powerful Politburo to be endorsed at the Party Congress this fall (China Brief, May 27).
Reeling Retail, Real Estate Sectors............To Read More....
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