Economy & Finance
There is a growing debate as to whether Chinese financial regulators have the spine to stick with their financial de-risking program as economic growth starts to ease more rapidly in the second half of 2018.
At the 2018 Two Sessions, the Party and government clearly outlined the key economic policy priorities for the next 12 months. Nine key policy buckets are designated throughout the government work reports, and they follow directly from Xi Jinping’s report to the 19th Party Congress.
Xi Jinping on the economy – Part 3 of 3: Xi’s take on monetary policy, fiscal policy, and policy coordination
Xi Jinping frames his outlook for economic development through the lens of Supply-Side Structural Reform (SSSR). In fact, when it comes to the economy, Xi identifies SSSR as the Party’s “main task”. But what is that, exactly? And what does that mean for businesses in China?
Skeptics may not agree, but we think the data is clear: Chinese banks are taking significant steps toward de-risking.
We examined Xi Jinping’s wide-ranging report to the 19th Party Congress in October 2017. The most important message, in our view, is that a fundamental question that the Party was grappling with over the past five years has been answered: What is the role of the market in China?
The CEWC is an annual gathering of Party leadership that takes place in December and discusses China’s economic outcomes from the past year. More importantly, it outlines economic policies that should be implemented over the next twelve months.
The most recent data from the PBoC and the CBRC show that bank asset growth hit a fresh all-time low in October. That means China is actually deleveraging – a little. It’s slow and slight, and done with a bit of trickery, but the debt load has shrunk in comparison to the size of the economy.