29 October-4 November 2023

Weekly newsletter tracking high-level policy signals sent by China’s top leaders. For more information, visit About Five Things.

Commentary

Last week’s most widely circulated article in China’s official media was about the two-day meeting of the Central Financial Work Commission held from 30-31 October.

These meetings have been held roughly every five years since 1997, and they decide the general direction of China’s finance sector management, setting the tone for the coming years.

Three things stood out at this year’s conference. First was the need for greater central oversight through Communist Party organs, particularly its Central Finance Commission, set up earlier this year. Second, was an emphasis on the need for more central guidance as to what happens across China’s finance sector. And third were the repeated mentions of risk – 19 times in the article reporting on the meeting.

But perhaps what was most striking – and certainly worth emphasizing - is how conservative the meeting’s prescriptions were, principally being aimed at preventing problems or stopping them from blowing up.

In many ways, this approach is appropriate. One thing it is clearly directed at is local government finance, especially the enormous body of debt built up at local government level in the last 15 years and the many threats this might harbour.

Another target of course is managing China’s ongoing property crisis and the enormous potential for destruction it still holds.

Clearly China’s leaders want greater visibility on these matters such of these and to have the ability to prevent similar or other problems arising in the future. And it is likely that their messages will be absorbed by officials down the hierarchy, both in governments and financial institutions.

Yet this approach begs another question. Against such a backdrop of caution, who’s going to want to embark on or start pushing the riskier ventures and reforms that China will need if it is to start realizing its ambitious development goals.

In 1992, Deng Xiaoping sparked both a turnaround in growth and a reversal of conservative economic policies with his now famous southern tour, calling on localities to adopt market reforms and open themselves to the world. Today, it’s hard to see anyone who could do something similar for China.

Top-ranked articles for 29 October-4 November 2023
% = percentage of publications monitored carrying the article

1. Central Financial Work Conference held in Beijing
中央金融工作会议在北京举行Xinhua News Agency, 31 October 2023
Chinese / Machine translation / 50%

2. Comrade Li Keqiang's Biography
李克强同志生平Xinhua News Agency, 2 November 2023
Chinese / Machine translation / 50%

3. Unswervingly follow the path of socialist women’s development with Chinese characteristics, Organize and mobilize women to contribute their strength to China’s modernization drive
坚定不移走中国特色社会主义妇女发展道路 组织动员广大妇女为中国式现代化建设贡献巾帼力量
Xinhua News Agency, 30 October 2023
Chinese / Machine translation / 38%

4. “Qiushi” magazine publishes important article by General Secretary Xi Jinping: “Speech at the First Meeting of the 20th Central Audit Commission”
《求是》杂志发表习近平总书记重要文章《在二十届中央审计委员会第一次会议上的讲话》
Xinhua News Agency, 31 October 2023
Chinese / Machine translation / 38%

5. Xi Jinping holds video conference with Germany’s Chancellor Scholz
习近平同德国总理朔尔茨举行视频会晤Xinhua News Agency, 3 November 2023
Chinese / Machine translation / 37%

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