China’s leaders sending ‘confusing, inconsistent’ messages over economic reform
Veteran China watcher says Beijing’s slow progress towards state sector reform now biggest risk to its economy
The Chinese leadership, headed by President Xi Jinping, is sending out conflicting messages about economic liberalisation and state enterprise reform, says a veteran China economist.
Nicholas Lardy, a senior fellow at Peterson Institute for International Economics, in Washington, also warned that the tepid progress of state sector reform was now the “the biggest risk to China’s economy”.
Whether Beijing is committed to a free market economy, or one that is heavily regulated and dominated by state players, is a question of great importance for the future of the world’s No. 2 economy.
However, Xi, the most powerful Chinese leader in decades, is not giving a clear-cut answer to that, according to Lardy, who has studied the Chinese economy for more than three decades.
The signals sent by Xi Jinping are confusing and inconsistent
The ruling Communist Party announced a sweeping reform plan three years ago to reshape the economy towards one that was market driven, including making state-owned enterprises more efficient. But Xi, also the General Secretary of the party, has called for the party to strengthen its “leadership” role in state businesses.