The upcoming National People’s Congress (NPC) is the first major government function in the second of perhaps many terms of the Xi Jinping presidency, and it comes in the 40th anniversary year of the reform and opening period. The Congress will set the tone for policy for the next five years, if not longer.
In terms of short-term objectives, the Congress will likely signal broad policy continuity, with more emphasis on deleveraging and regulatory efforts to reduce financial risks rather than signs of policy support for growth at current rates. Longer-term, however, China’s leaders have built up expectations for economic reforms, and have sent clear signals that the NPC will further empower Party over government. The question of whether a new team of economic officials, including a new central bank governor, will have the mettle to invigorate reforms looms more ominously over China’s economic relations with the rest of the world after the probable extension of Xi’s tenure.
