Chinese economic reforms are ‘the only way out’ of US trade war, says veteran government adviser
- Li Jiange, who was secretary to former Premier Zhu Rongji, questioned Beijing’s approach to dealing with the trade war with the United States
- He said that the stimulus measures used during the Asian and global financial crises in 1998 and 2008 are not suitable to current slowdown
Reforms to China’s highly-leveraged economy are “the only way out” of its current economic malaise, according to a veteran government adviser, who questioned whether Beijing’s stimulus measures would be effective in riding out the trade war with the United States.
The Chinese government has scaled back efforts at curbing debt levels, instead turning to infrastructure investment and consumer spending as a means of encouraging growth, with the policies enjoying popular support among many scholars.
But Li Jiange, who was secretary to former Premier Zhu Rongji, said scholars are neglecting new problems facing China’s economy and suggested relying on the government to inject stimulus into the economy is not a good idea.
“The fundamental solution is reform and opening-up. That is the only way out for us,” Li told the Shanghai Advanced Institute of Finance forum in Beijing.
The fundamental solution is reform and opening-up. That is the only way out for us
“I have participated in several internal discussions in Beijing, it was interesting that the economists who suddenly advocated stimulus were the same ones who used to ask for deleveraging. They even felt reasonable to re-leverage the economy and they had many theories.
