China retains Apex Bank Chief and FM
China kept its finance minister and central bank governor in their jobs on Sunday. The rubber-stamp parliament’s annual session made the unexpected choice to favor continuity as economic difficulties grew imminent. Both the finance minister Liu Kun and the governor of the People’s Bank of China (PBOC), Yi Gang, are 65 years old. President Xi Jinping, who has been putting supporters in important positions, the bucked convention by maintaining both men in their roles despite the fact that they have both surpassed the legal retirement age of 65. The measure demonstrates an emphasis on credibility and stability in addition to a hidden acknowledgment of some of the challenges Beijing is now experiencing.
Whether this third Xi administration will address fundamental imbalances in China’s economy and implement the changes required to ensure China’s long-term competitiveness represents the administration’s real test.
The government has increased its 2023 economic growth objective from 3% to about 5%. The appointment of Li Qiang, a 63-year-old confidant of Xi, to the premier was the greatest change of the legislative session. Li Keqiang, 67, who resigned after serving two terms of five years each, is replaced in the position responsible for directing the economy by the former leader of the Shanghai Communist Party. By keeping senior financial specialists in the cabinet, according to Zhang Zhiwei, chief economist at Pinpoint Asset Management, the government sent a good signal to the market. After being dropped from the Central Committee of the ruling Communist Party during the party’s once-every-five-years conference, Yi Gang, who was appointed governor of the PBOC in 2018, was anticipated to resign.
Experts had predicted that Yi and Liu would be replaced by individuals with significantly less foreign experience once they stepped aside.
Both Zhu Hexin, chairman of the government-owned financial conglomerate CITIC Group Corp., and Wang Wentao have been appointed as China’s ministers of commerce and the central bank, respectively. Zheng Shanjie, the vice party secretary and governor of Zhejiang province, received the nomination to head the National Development and Reform Commission, the powerful state planner. The selection of the central bank governor and finance minister demonstrates the administration’s emphasis on management, professionalism, and the fine art of tuning.
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