BreakingViews: Xi’s contract with China needs more signatures

HONG KONG, Oct 23 (Reuters) – Xi Jinping effectively secured a third term as president at the just-concluded secret meeting of the Communist Party of China. His prize: a $16 trillion economy in a weak country, dependent on American technology and facing a demographic crisis. Xi also faces popular resentment over the economic pain his brutal policies have caused ordinary citizens. The so-called head of everything in China has the power to comfort his people, but it is unclear whether he has the will.

Xi’s third term as prime minister is only a formality, after his tenure as general secretary of the ruling party was confirmed on Sunday, with loyalists taking key roles in the seven-man Politburo Standing Committee. The presidential term limits were abolished in 2018. The upcoming term, which will officially start in March 2023, is supposed to bring more freedom to work toward his goals of “common prosperity” and the “Chinese Dream.”

This may be more difficult than it seems. Over the course of his decade in office, China has ended extreme poverty and nearly doubled its gross national income — which stood at $11,890 per capita in 2021, breaking the World Bank’s definition of high income of nearly $13,000. However, the middle class appears to be oddly disappointed. The “lying flat” movement similar to the slacker phenomenon that was central to the United States in the 1990s is gaining popularity. With the support of the United Nations Global Happiness Index 2022 The report placed the People’s Republic of China at 72nd: the saddest place in East Asia.

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The inflexible zero-Covid policy has not helped turn cities from Shanghai to Chengdu into giant holding cells. Attempting to isolate 1.4 billion people from exposure to Covid-19 has taken a wrecking ball to commerce; One in five young workers is unemployed, the highest on record. Xi has cracked down on tech entrepreneurs, and his drive to reduce debt levels in the real estate sector is slashing home prices as most Chinese households deposit most of their savings.

More tactful approaches in these areas—especially stopping harsh lockdowns—could produce quick results. There are other fruits that can be reaped with a bit of political power: strengthening the social safety net, for example; redistribution of wealth by reshaping the lackluster tax system; Renovation of vocational schools and universities to better serve business demand.

Xi could definitively end the hukou system that deprives migrant workers of health care and education. The government owns large stakes in companies such as the Industrial and Commercial Bank of China, worth $218 billion. (601398.SS)the world’s largest lender by assets, and its government institutions have sat down 260 trillion yuan ($36 trillion) in assets at the end of 2021. This wealth could be transferred into private hands by injection into underfunded pension systems or other methods.

But so far, Xi has appeared more focused on securing loyalty, suppressing dissent, and fighting Western influence rather than redistributing wealth. His anti-epidemic stimulus package was remarkably stingy compared to her peers, as she did Spending on health care. Focusing on weaning China from foreign programs and semiconductors entails significant duplication of effort. This means that the Chinese may acquire smart drones before they have good unemployment insurance. It won’t make them happier or richer, and it may not make Shi in the end safer.

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The Chinese Communist Party elected President Xi Jinping as its general secretary on October 23, its third five-year term, according to Chinese state media.

(The writer is a columnist for Reuters Breakingviews. The opinions expressed are his own.)

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Editing by John Foley and Katrina Hamlin

Our criteria: Thomson Reuters Trust Principles.

The opinions expressed are those of the author. They do not reflect the views of Reuters News, which is committed under the Trust Principles to impartiality, independence, and freedom from bias.

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