China’s leaders are currently in the midst of a meeting in Beijing to address the country’s fractured property market, high unemployment rates, and the need for faster economic growth. The National Financial Work Conference, which is held roughly every five years, seeks to fortify President Xi Jinping’s control of the financial sector. The gathering is expected to address long-term reforms related to the financial sector, including the real estate market, which is currently a priority. Notably, the construction of new homes has slowed down sharply, leading to economic challenges. The impact of the COVID-19 pandemic has also caused disruptions in the financial sector.
The meeting comes in the wake of the sudden death of former Premier Li Keqiang, signaling a shift towards stronger party controls. President Xi has made significant changes in economic and financial leadership positions, further consolidating the party’s influence over markets and financial institutions. The new finance minister, Lan Fo’an, faces a substantial challenge in dealing with significant levels of debt, particularly in local governments.
Despite the Chinese economy expanding by 4.9% annually over the first nine months of the year, concerns about high levels of government debt have been raised. The jobless rate for young Chinese people has reached over 20%, while the demand for goods and services has yet to fully recover. The issue of excessive borrowing in the property market has also become apparent, with major developers like China Evergrande facing challenges. The company has struggled to pay off its substantial debts, with its chairman recently detained in an investigation. The government has implemented measures to alleviate the impact of the property crisis, including easing housing purchase controls and providing support for private industries.
Ultimately, the goals of the National Financial Work Conference are aimed at addressing the economic challenges facing China, particularly in the property market and unemployment issues, as well as fostering sustainable, balanced growth. The outcome of the meeting is expected to have far-reaching implications for China’s financial sector and its economy as a whole.
AP Business Writer Zen Soo in Hong Kong contributed to this report.
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