‘Economic tsar’ Liu He has President Xi’s full trust, but who can fill in when Liu retires?

Name: China’s ‘lazy economy’ spawns companies that tidy up and organise homes
Uploaded: 2022-08-31T22:00:16.000Z
Duration: 1 min 27 s
Description: China’s ‘lazy economy’ spawns companies that tidy up and organise homes

Short- and long-term economic challenges are testing China, putting added pressure on its top economic adviser

Vice-Premier Liu He is Xi Jinping’s right-hand man for economic affairs, but some analysts say any potential replacement might not have as much personal authority

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Will Vice-Premier Liu He bid adieu next month to his role as China’s ‘economic tsar’? Illustration: Brian Wang

Frank Tang

Published: 6:00am, 1 Sep 2022Updated: 10:06am, 5 Sep 2022

Dazzling economic figures used to be the best decorations for China’s five-yearly Communist Party leadership reshuffle, showcasing solidarity and development, but the upcoming 20th party congress will probably have to do without such adornments.

Following economic growth of just 0.4 per cent in the second quarter of the year, third-quarter growth is set to be much weaker in 2022 than in decades past – the 14.6 per cent quarterly rise seen in 1992, the 9.6 per cent in the same period in 2002, and the 7.5 per cent quarterly growth before Xi Jinping became party general secretary a decade ago.

The economic turmoil – reflected in rising youth unemployment, a local banking crisis and trade frictions with the West – calls for strong and visionary leadership. And while Xi is expected to receive overwhelming applause at this year’s congress, a great deal of attention will turn to who will be the “economic tsar” – currently Vice-Premier Liu He – as the world’s second-largest economy weathers a variety of storms.

Analysts expect the job to go to a person with deep knowledge of the Chinese economy and finances, with the top leader’s endorsement to take painful but necessary actions, and with extensive working experience to ensure thorough local enforcement.

Domestically, the Chinese economy has been battered by zero-Covid policies that continue to haunt businesses and consumers, and a plunging property sector that has underscored financial risks, all while the country’s population is ageing rapidly and productivity growth is declining.

Externally, it faces technological containment and economic rivalry from the United States as it challenges American dominance in the next decade.

While Premier Li Keqiang is in charge of China’s overall economic development, Liu, who has Xi’s full confidence, has been given many important portfolios and tasks, making him one of China’s most influential economic and financial officials ever.

Although Liu remains a known quantity in terms of policy stability and continuity, he is now 70 years old and likely to be subject to unwritten retirement norms that see those aged 68 or above at the time of a party congress put out to pasture.

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China’s ‘lazy economy’ spawns companies that tidy up and organise homes