Politics
Even Xi Jinping admits China has a tough road ahead despite stimulus measures
- In the hope that the Chinese economy will come back to life, even Xi Jinping is being cautious.
- In his first major speech since the stimulus package, Xi warned of coming “storms” and the need to prepare for “rainy days.”
- While describing China as resolute, Xi also tempered the notion that the country was on the path to victory.
China's surprise stimulus measures sparked a massive rally in its stocks last week, but even its leader, Xi Jinping, isn't celebrating yet.
In his first remarks on the nation's situation since the recovery plan was announced, Xi warned of coming “violent storms” and urged China to prepare for difficulties while portraying it as determined to succeed .
“The road ahead will not be easy,” he said in a speech Monday in Beijing. “There will definitely be difficulties and obstacles, and we may face major challenges, such as strong winds, high waves or even severe storms.”
Xi was speaking on the 75th anniversary of the People's Republic of China, using the occasion to promote his regular messages, such as the country's modernization and the absorption of Taiwan under Beijing's rule.
However, he did not mention the wide range of recovery efforts announced by his government on Tuesday. These included the issuance of $284 billion in sovereign bonds and the reduction of mortgage rates and short-term interest rates.
They have given way to renewed optimism about a deeply suffering Chinese economy, although skeptics say it is unlikely that the policy changes will have remotely succeeded in resolving all of the problems. problems causing the crisis.
Xi's own words at the Great Hall of the People reflect that caution, even as his administration strained Monday to portray China with pomp and pride. A large orchestral choir sang the nation's praises as clips of its industries and landscapes played on a towering screen before rows of officials.
The Chinese leader spoke of a “new era” for China with a “bright and brilliant outlook,” but at the end of his speech he cited a traditional poem to say the nation was only halfway through path to its objectives.
“We must prepare for danger, prepare for rainy days,” Xi said.
Beijing's stimulus plan came as its government urgently seeks to revive plummeting sentiment in China's economy.
The country endured three years of strict lockdowns during the COVID-19 pandemic, which sank businesses and forced consumers to tighten their belts. And that added to major headwinds in China's already struggling real estate market.
Barclays analysts estimated earlier this month that households in this region had lost $18 trillion in wealthor on average about $60,000 per household of three people. This is almost four times the median annual salary of a typical city employee.
