The Central Financial Work Conference was held this week, an event that usually takes place once every five years. So normally does the Third Plenum of each of the party’s five-year congresses, and that should normally have taken place by now, but there is no sign of it. The third plenum is important because it is very often an event at which economic policy direction is fixed. Anyway, the economy and the financial system are definitely not in great shape so the work conference was viewed with great interest in terms of what the system plans to do about debt mountains, property market crises, investor paralysis and the unwillingness of consumers to spend. People are looking for direction. This a centrally-managed economy and the question is what the center is going to do to manage the situation. And the answer, according to the documents and readouts from the conference seen so far, is that ‘grasp ideology’ is the key link.
The following is a very long sentence but it sums up succinctly the message and it is worth reading to fully absorb the sense of China today: “The conference emphasized that for the current and future periods, it is necessary to adhere to and strengthen the Party’s overall leadership over financial work, guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, comprehensively implement the spirit of the 19th Party Congress, comprehensively implement the new development concept, deeply understand the political and people-oriented nature of financial work, take building a strong financial nation as the goal, promote high-quality financial development as the theme, deepen structural reforms on the financial supply side as the main line, make the purity, professionalism, and combat effectiveness of the financial workforce a key support, focus on strengthening overall regulation and preventing and resolving risks, maintain the overall work guideline of seeking progress while maintaining stability, balance development and security, firmly adhere to the bottom line of preventing systemic financial risks, resolutely follow the path of financial development with Chinese characteristics, accelerate the construction of a modern Chinese financial system, continuously meet the growing financial needs of economic and social development and the people, and constantly create a new era in financial work.”
In other words, if we may make so bold, it’s all about party control.
In other news, the property market is not getting any better, it looks like Mr. Xi will go to San Francisco next week to meet Mr. Biden and two pandas were flown out of the US. Pardon our cynicism but what are the chances of Mr. Xi offering pandas to Mr. Biden when they meet?
Have a great weekend.