(Linette Lopez – Business Insider)
The future of China is clear and the future of China is dark.
This week the country’s President, Xi Jinping, enshrined himself into the constitution — something no leader has done since legends Mao Zedong and Deng Xiaoping. He also failed to lay plans for his succession, and stacked party politburo with allies.
This — considered in conjunction with Xi’s years-long efforts to purge the party of his enemies in the name of fighting corruption — means the future is clear. It’s Xi’s China now.
And in Xi’s China the future is dark. China’s economy is not well. The deleveraging and rebalancing that has been promised since 2014 has yet to materialize, despite appearances of stability.
That means the government still has difficult choices ahead. Will it allow the yuan to depreciate? Will it tighten its control over outflows? Will it choose winners and losers in the banking sector? How will it ensure that massive state-owned enterprises get rid of debt and overcapacity without leaving millions without work?
It will do so, Xi said, by strengthening the hand of the state and accepting a new reality. Click here to read more.