MERICS Members Event: Xi’s third term starts under massive economic stress

As the latest edition of our quarterly MERICS Economic Indicators (which MERICS Members received in the last days) explained, Xi Jinping started his third term as General Secretary of the Communist Party at a time when China’s economy is under massive stress. In an unprecedented move, China delayed the release of Q3 economic data, which was originally scheduled for release during the Party Congress. When the numbers were finally released, they showed that China’s economy expanded by 3.9 percent in the third quarter. Growth improved compared to Q2, but sentiment is stuck at rock bottom as China’s economy is suffering from an unprecedented combination of domestic and external challenges. 

Much of the slowdown has been self-inflicted: China's economy continues to suffer from the government’s inability to shift away from its damming zero-Covid policy. The reoccurring lockdowns and lack of exit strategy are causing severe exhaustion among businesses and consumers. The resulting pessimistic sentiment is impacting retail spending and investments. But China’s economy is also held back due to a “PoliXi”-overdose: the tech and real estate crackdown, reducing emissions and financial risks all cut economic growth. Each on its own might have its merits but prescribing too much medicine at once is causing unknown side effects to the economy. 

Speaker:

Max J. Zenglein, Chief Economist, MERICS
Katja Drinhausen, Head of  Politics and Society 

Moderation:
Claudia Wessling, Director Communications and Publications

The meeting was confidential and by personal invitation only. This online event was part of our portfolio for MERICS Members and key stakeholders.