The third plenary session of the 20th Central Committee will take place in China next month, marking a significant economic reform or policy announcement. However, the postponement of the Third Plenum in 2023 raised questions about the Chinese Communist Party’s unity under President Xi Jinping concerning economic policy. The uncertainty arose following the lackluster performance of the Chinese economy after the lifting of Xi’s “Zero Covid” policy in late 2022.
Currently, there are conflicting views on China’s economy in the media outside of China. One perspective highlights the structural issues and policy missteps that have plagued Xi’s administration, such as low economic growth, high unemployment, weak consumption, demographic challenges, and a lack of confidence in the future. On the other hand, another viewpoint emphasizes China’s successes in manufacturing, especially in sectors like solar and electric vehicles, achieved through industrial policy and state-led development. China’s advancements in these areas pose a threat to capitalist economies.
Both narratives mention overcapacity and export surpluses as crucial elements connecting China’s negative and positive aspects of its economy. The country’s reliance on export-driven manufacturing due to a lack of domestic consumption indicates a need for a shift in economic policy. Despite highlighting different aspects of China’s political economy, these media narratives are interdependent and shed light on the complexities of China’s economic challenges and successes.
In conclusion, as we await the outcome of this crucial meeting, it is essential to understand both sides of this complex debate surrounding China’s economy. While some argue that Xi Jinping’s administration has made significant mistakes that have hindered economic growth and created social unrest within certain sectors, others see his leadership as necessary for continued industrial growth and technological advancement.
Ultimately, it is up to Beijing to find a balance between these competing perspectives and implement policies that will not only boost economic growth but also address concerns about overcapacity and export surpluses while maintaining stability within society. Only then can we truly understand how China will continue to shape our global landscape in years to come.
As we move forward into this new era of global trade relations with China at its center stage once again, it is imperative that we recognize both its strengths and weaknesses when analyzing its political economy landscape.