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China’s economic strategy shift shows Xi Jinping is preparing for ‘worst case scenario’, analysts say
- The Chinese president said that Beijing was pursuing a new development plan, focusing on its domestic market rather than an export-led growth model
- China’s economy is under pressure from the coronavirus, as well as escalating trade war and technology tensions with the United States
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China’s move to double down on a pivot away from export-led growth in favour of developing its domestic market reflects a strategic shift by Beijing to prepare for the “worst case scenario” after the coronavirus pandemic, according to analysts.
President Xi Jinping told dozens of top economic advisers in Beijing at the weekend that China was pursuing a new development plan in which “domestic circulation plays the dominant role”.
“For the future, we must treat domestic demand as the starting point and foothold as we accelerate the building of a complete domestic consumption system, and greatly promote innovation in science, technology and other areas,” Xi said in comments published by the official Xinhua News Agency.
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Xi’s remarks suggest that Beijing is moving towards giving up the “great international circulation” strategy adopted in the 1990s that helped fuel its growth to become the world’s second-largest economy.
It’s a kind of preparation for the worst-case scenario, including the decoupling with the United States and even the whole western world
“It’s a kind of preparation for the worst-case scenario, including the decoupling with the United States and even the whole Western world,” said Hu Xingdou, a Beijing-based independent economist.
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