Inequality in the crosshairs, but dim outlook for economic reform – China’s latest business and technology news

Business & Technology

A summary of the top news in Chinese business and technology for October 25, 2017. Part of the daily SupChina newsletter, a convenient package of China’s business, political, and cultural news delivered to your inbox for free. Subscribe here.

Though some pundits are still saying that the second five years of Xi Jinping’s term will see long-promised market-based reforms and greater openness to foreign investment, the majority of commentators are highly skeptical.

  • Bloomberg notes that Xi’s “remarks on reform — pledging to open up to foreign businesses, deepening state-run enterprise reform, strengthening financial sector regulation — stuck closely to language that had previously disappointed investors.” The primary message on the economy at this time, it seems, is that the Party is in control.
  • The appointment of Liu He 刘鹤, whom Bloomberg describes as “one of President Xi Jinping’s closest financial and economic advisers,” to the Politburo indicates continuity between Xi’s first and second terms. The economists behind consulting firm Trivium add, “Forget any shift toward marketization. The economic policy agenda that Liu designed has been in place for two years already. There is no pivot coming.”
  • But at least one point of economic policy has markedly changed: the focus on inequality. Bloomberg says that Xi’s call to confront the challenge “between unbalanced and inadequate development and the people’s ever-growing needs for a better life” will “influence China’s policy for decades to come.” As SupChina has noted, a large part of this challenge lies in environmental protection, and a tide appears to have turned in how seriously China is cracking down on pollution.