With a leadership change looming in less than a year it is unsurprising that people are keeping quiet on the Chinese political front. Beijing’s political heir apparent, Xi Jinping, has so far given few clues about the economic policies he will pursue when he takes the helm. And yet two documents emerging this week show that the debate on the future of China’s economy is far from mute.
A report to be published on Monday by the World Bank and a Chinese government think-tank is expected to warn Beijing of the risks associated with postponing economic reforms – including scaling back the country’s vast state-owned enterprises. More importantly, a landmark report by China’s central bank is asking the government to accelerate the loosening of capital controls.
While Beijing achieved full current-account convertibility in 1996, the road to capital-account liberalisation has proceeded more slowly. Thursday’s document is the most detailed plan published by any government institution to tackle what is still perceived as a thorny political issue.