China reshuffle in wake of slow growth at home and US tension
Print Edition
CHINA has named a trade specialist as its new commerce minister and appointed a new head of its top economic planning body as part of a Cabinet reshuffle that comes amid a lackluster growth and the threat of increased trade friction with the United States.
Top trade representative Zhong Shan, 61, will become minister of commerce, while He Lifeng, 62, will take over the powerful National Development and Reform Commission, Xinhua news agency reported yesterday.
The two new appointees will step into crucial roles guiding the world’s second-largest economy at a time of serious challenges. China’s economic growth fell last year to 6.7 percent, its weakest pace since 1990, while exports shrank by 7.7 percent.
America’s new President Donald Trump, meanwhile, has pledged to take a tougher line toward China on trade, raising fears of a slump in commerce between the two key trading partners.
Chinese policy-makers are entering an “uneasy” moment and are seeking to expand trade agreements with countries other than the US, said Louis Kuijs, head of Asia economics at Oxford Economics and a former China specialist at the World Bank.
Trump continued his feisty rhetoric on Thursday, calling China the “grand champions” of currency manipulation for allegedly seeking an unfair export advantage by keeping the yuan undervalued. That drew a rebuttal from Chinese foreign ministry spokesman Geng Shuang.
“China has no intention to gain trade advantages by devaluing its currency on a competitive basis,” Geng said. “We hope that relevant parties can view the (Chinese currency) exchange rate issue in an objective light and do more that contributes to mutual trust and cooperation.”
Despite his tough talk, Trump made no indication that he would make good on his campaign promise to formally declare China a currency manipulator.
China in recent months has been spending heavily from its stockpile of foreign currency to shore up the yuan’s value amid slowing growth.
Trump’s gospel of economic nationalism has also raised concerns in China, particularly his threat to slap tariffs as high as 45 percent on Chinese imports that would be likely to spark a trade war if carried out.
China’s annual legislative session opens on March 5 with a focus on keeping the economy moving ahead and creating jobs for laid-off workers and recent graduates.
The legislative session will be followed in the autumn by the Communist Party congress, an event held every five years at which top Party leaders will be named.
The appointment of Zhong, a trade specialist who used to work in a trading company himself, reflects the government’s emphasis on maintaining its competitive position in trade, said Hu Xingdou, a political science professor at Beijing Institute of Technology.
“Appointing him as minister indicates that China will soon engage in more bilateral and multilateral negotiations,” Hu said. “China intends to push forward trade globalization and freedom and is determined to be the leader in this respect.”
The reshuffle, Hu added, was seen as a chance to put new officials in charge who could push through needed reforms.
Top government officials have talked up moving the economy away from debt-fueled building to a model based on domestic consumption.
Other new appointments in yesterday’s reshuffle included Zhang Jun, a high-level official in the Communist Party’s anti-corruption agency, as justice minister.
The Party also announced that Shandong Province Governor Guo Shuqing had resigned from his position amid widespread speculation that he would take up a crucial post overseeing China’s banking system.
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