China’s chief economist
Xi Jinping's senior officials are shrinking the space for policy debate, as the president presses ahead with his vision for advanced manufacturing to propel China's $17 trillion economy.
During his first decade in power, policymakers held regular, often lively, discussions with economists from foreign banks and local experts, sources say.
But such candid exchanges have become rare since the Chinese leader consolidated his rule for a precedent-defying third term in March last year. International experts find it harder to sit down with senior officials, and even when meetings do take place they lack the meaningful debate of previous years, they said.
Chinese economists say they can't tell if their proposals are being heeded by officials who mostly nod and take notes in increasingly formal meetings, the sources added.
"Xi Jinping is now the chief economist of China," said Stephen Roach, former Morgan Stanley Asia chairman, who was invited to attend a summit in Beijing this year.
China's most-powerful leader since Mao Zedong reaffirmed his commitment to high-tech innovation guiding growth in the world's second-largest economy at a twice-a-decade policy conclave last week.
That reflects a disconnect in how Xi and market economists view the country's situation. Analysts and foreign officials want Beijing to stimulate sluggish domestic demand, and lean less on surging exports that are prompting tariffs overseas.
Xi has national security to consider amid increasing political and trade frictions with the US and the European Union.
Becoming a superpower in electric cars or artificial intelligence has the added benefit of building self-sufficiency, as the US tries to block China's access to cutting-edge chips.
With the next American president — be it Donald Trump or Kamala Harris — likely to stay tough on China, Xi's priority isn't about to change. — Jenni Marsh
Global Must Reads
Harris is close to locking in the Democratic presidential nomination and has rapidly clinched key endorsements, not only from influential party figures such as former US House Speaker Nancy Pelosi but also all potential rivals. The only person who hasn't endorsed her yet? Barack Obama. Next up, picking a running mate from the rising stars in the party.
From Berlin to Brasilia, the rest of the world is adapting to the latest twist in what has been a tumultuous US election campaign. Western officials are relieved that Joe Biden decided to drop out of the race and see Harris having at least a shot at beating Trump in November. But they are not taking any chances and are cultivating contacts in the Republican camp, in the knowledge that a second Trump term may be on the cards.
French President Emmanuel Macron is trying to play host of the Summer Olympics in Paris that starts on Friday, while still juggling a major political crisis that he set off by dissolving the lower house of parliament. He has yet to appoint a prime minister and the legislative election, rather than clarify things as he had hoped, has only led to further gridlock.
Venezuela's elections are looming at the end of this month, and Brazilian President Luiz Inacio Lula da Silva has a few words of warning to his long-term ally Nicolás Maduro about making it a clean and fair vote: "Whoever loses an election gets a reality check, not a blood bath. Maduro needs to learn: when you win, you stay; when you lose, you go away and get ready to dispute another election."
Hungarian Prime Minister Viktor Orban has been exploiting his rotating presidency of the council of the EU to do all kinds of diplomatic freelancing that has irritated his counterparts in the bloc — including trips to Moscow, Beijing and Trump's Mar-a-Lago resort in Florida. Now they've moved a key meeting out of the capital Budapest to send him a message.
Israeli Prime Minister Benjamin Netanyahu said conditions for a cease-fire and hostage deal with Hamas are "becoming ripe," suggesting the sides are getting closer to agreeing to at least a temporary halt to their war in Gaza.
Kenya plans to seek fresh financing from the International Monetary Fund amid the economic fallout from deadly protests that forced President William Ruto to backtrack on raising more than $2 billion in new taxes.
Prime Minister Narendra Modi pledged 2 trillion rupees ($23.9 billion) to boost jobs and improve education in India, and increase spending to his new allies, while also targeting a smaller fiscal deficit for this year.
Spanish Prime Minister Pedro Sanchez has been summoned to testify next week as a witness in a criminal investigation into his wife's business dealings, adding pressure on an already fragile government.
Washington Dispatch
Even though Biden has taken himself out of the running for the election, his foreign policy agenda remains in force, with Secretary of State Antony Blinken and Defense Secretary Lloyd Austin heading to Asia this week.
Their visits to Japan and the Philippines are part of a long-term strategy to reinforce American diplomatic and military commitment in the face of a more assertive Chinese stance in the South China Sea and East China Sea.
The trips were planned long before Biden announced his decision. "We did in no way consider canceling this trip because the work we are doing in the Indo-Pacific is one of our top priorities and it needs to continue," said Matthew Miller, a State Department spokesperson.
On Sunday, the same day Biden announced that he would not pursue reelection, he told Blinken he wanted the administration's work to continue as planned, especially when it came to national security, Miller said.
One thing to watch today: Existing home sales in June will be reported.
Sign up for the Washington Edition newsletter for more from the US capital and watch Balance of Power at 1 and 5 p.m. ET weekdays on Bloomberg Television.
Chart of the Day
Europe still contends with China as the top buyer of Gazprom's pipeline gas, more than two years after Russia's invasion of Ukraine slashed its Western energy sales. Even after extensive sanctions, Russia supplies substantial volumes to select European countries — and has increased the amount this year. Moscow also hasn't made new deals to boost supplies to China beyond what was already agreed to before its biggest export market collapsed.
And Finally
Under Cairo's baking summer sun, a forecourt of heavily discounted new Toyotas showcases a surprising side-effect of Egypt's nearly 40% currency devaluation in March: prices for big-ticket items are tumbling. They've fallen so much that would-be buyers of everything from sofas to refrigerators and automobiles are holding off, convinced they can wait for a better deal. That's an issue Egypt's consumer-led economy needs to overcome. It also flies in the face of experience in places like Nigeria and Argentina where costs surged after devaluations.
During his first decade in power, policymakers held regular, often lively, discussions with economists from foreign banks and local experts, sources say.
But such candid exchanges have become rare since the Chinese leader consolidated his rule for a precedent-defying third term in March last year. International experts find it harder to sit down with senior officials, and even when meetings do take place they lack the meaningful debate of previous years, they said.
Chinese economists say they can't tell if their proposals are being heeded by officials who mostly nod and take notes in increasingly formal meetings, the sources added.
"Xi Jinping is now the chief economist of China," said Stephen Roach, former Morgan Stanley Asia chairman, who was invited to attend a summit in Beijing this year.
China's most-powerful leader since Mao Zedong reaffirmed his commitment to high-tech innovation guiding growth in the world's second-largest economy at a twice-a-decade policy conclave last week.
That reflects a disconnect in how Xi and market economists view the country's situation. Analysts and foreign officials want Beijing to stimulate sluggish domestic demand, and lean less on surging exports that are prompting tariffs overseas.
Xi has national security to consider amid increasing political and trade frictions with the US and the European Union.
Becoming a superpower in electric cars or artificial intelligence has the added benefit of building self-sufficiency, as the US tries to block China's access to cutting-edge chips.
With the next American president — be it Donald Trump or Kamala Harris — likely to stay tough on China, Xi's priority isn't about to change. — Jenni Marsh
Pedestrians in Wuhan on Sunday. Photographer: Qilai Shen/Bloomberg
Global Must Reads
Harris is close to locking in the Democratic presidential nomination and has rapidly clinched key endorsements, not only from influential party figures such as former US House Speaker Nancy Pelosi but also all potential rivals. The only person who hasn't endorsed her yet? Barack Obama. Next up, picking a running mate from the rising stars in the party.
From Berlin to Brasilia, the rest of the world is adapting to the latest twist in what has been a tumultuous US election campaign. Western officials are relieved that Joe Biden decided to drop out of the race and see Harris having at least a shot at beating Trump in November. But they are not taking any chances and are cultivating contacts in the Republican camp, in the knowledge that a second Trump term may be on the cards.
French President Emmanuel Macron is trying to play host of the Summer Olympics in Paris that starts on Friday, while still juggling a major political crisis that he set off by dissolving the lower house of parliament. He has yet to appoint a prime minister and the legislative election, rather than clarify things as he had hoped, has only led to further gridlock.
Venezuela's elections are looming at the end of this month, and Brazilian President Luiz Inacio Lula da Silva has a few words of warning to his long-term ally Nicolás Maduro about making it a clean and fair vote: "Whoever loses an election gets a reality check, not a blood bath. Maduro needs to learn: when you win, you stay; when you lose, you go away and get ready to dispute another election."
Maduro during a campaign rally in Caracas on July 16. Photographer: Gaby Oraa/Bloomberg
Hungarian Prime Minister Viktor Orban has been exploiting his rotating presidency of the council of the EU to do all kinds of diplomatic freelancing that has irritated his counterparts in the bloc — including trips to Moscow, Beijing and Trump's Mar-a-Lago resort in Florida. Now they've moved a key meeting out of the capital Budapest to send him a message.
Israeli Prime Minister Benjamin Netanyahu said conditions for a cease-fire and hostage deal with Hamas are "becoming ripe," suggesting the sides are getting closer to agreeing to at least a temporary halt to their war in Gaza.
Kenya plans to seek fresh financing from the International Monetary Fund amid the economic fallout from deadly protests that forced President William Ruto to backtrack on raising more than $2 billion in new taxes.
Prime Minister Narendra Modi pledged 2 trillion rupees ($23.9 billion) to boost jobs and improve education in India, and increase spending to his new allies, while also targeting a smaller fiscal deficit for this year.
Spanish Prime Minister Pedro Sanchez has been summoned to testify next week as a witness in a criminal investigation into his wife's business dealings, adding pressure on an already fragile government.
Washington Dispatch
Even though Biden has taken himself out of the running for the election, his foreign policy agenda remains in force, with Secretary of State Antony Blinken and Defense Secretary Lloyd Austin heading to Asia this week.
Their visits to Japan and the Philippines are part of a long-term strategy to reinforce American diplomatic and military commitment in the face of a more assertive Chinese stance in the South China Sea and East China Sea.
The trips were planned long before Biden announced his decision. "We did in no way consider canceling this trip because the work we are doing in the Indo-Pacific is one of our top priorities and it needs to continue," said Matthew Miller, a State Department spokesperson.
On Sunday, the same day Biden announced that he would not pursue reelection, he told Blinken he wanted the administration's work to continue as planned, especially when it came to national security, Miller said.
One thing to watch today: Existing home sales in June will be reported.
Sign up for the Washington Edition newsletter for more from the US capital and watch Balance of Power at 1 and 5 p.m. ET weekdays on Bloomberg Television.
Chart of the Day
 |
Europe still contends with China as the top buyer of Gazprom's pipeline gas, more than two years after Russia's invasion of Ukraine slashed its Western energy sales. Even after extensive sanctions, Russia supplies substantial volumes to select European countries — and has increased the amount this year. Moscow also hasn't made new deals to boost supplies to China beyond what was already agreed to before its biggest export market collapsed.
And Finally
Under Cairo's baking summer sun, a forecourt of heavily discounted new Toyotas showcases a surprising side-effect of Egypt's nearly 40% currency devaluation in March: prices for big-ticket items are tumbling. They've fallen so much that would-be buyers of everything from sofas to refrigerators and automobiles are holding off, convinced they can wait for a better deal. That's an issue Egypt's consumer-led economy needs to overcome. It also flies in the face of experience in places like Nigeria and Argentina where costs surged after devaluations.
 |
| Car sales in May declined by almost 75% compared with the monthly average in 2021. Photographer: Islam Safwat/Bloomberg |
No comments