Year-End Struggles to Meet Economic Targets: Zhongnanhai Pressures Local Officials

Under the bustling night scene, Shanghai is no longer what it used to be! (Video Screenshot)

November 7, 2024 — As the end of the year approaches, the Chinese Communist Party (CCP) leadership is anxious about failing to meet inflated economic targets. Following visits by State Council officials to local areas urging economic recovery, CCP leader Xi Jinping recently made statements in Hubei, pressing local officials to meet objectives. Analysts believe that the CCP leadership faces a self-inflicted economic crisis, making it difficult to meet "targets" with available data. Beyond pressuring local officials, there seem to be few options left.

CCP Central Television reported that Xi Jinping, during his visit to Hubei from November 4 to 6, stated that with less than two months left this year, economic work must be further "strengthened to achieve the full-year economic and social development targets." Hubei Party Secretary Wang Menghui and Governor Wang Zhonglin accompanied him.

Since the end of the "zero-COVID" policy, China's economy has remained sluggish. Despite this, the CCP set an economic growth target of about 5% for this year. While the Politburo meeting on September 26 reviewed the economic situation, no concrete policies were established. At the end of September, a series of measures—including rate cuts, reductions in mortgage rates, and an 800 billion yuan policy tool—temporarily boosted the stock market. However, following the "Golden Week" holiday, the stock market crashed again. Despite subsequent press conferences by various departments to emphasize policy measures, the market response remained weak.

On October 8, Premier Li Qiang held a meeting with experts and entrepreneurs to discuss the economic situation, urging the implementation of "a package of incremental policies" and quick formulation of specific plans for ongoing policy discussions.

According to data released by the CCP on October 18, China’s economy grew by 4.6% year-on-year in the third quarter, the slowest growth since early 2023 and the third consecutive quarterly decline. Given the CCP’s history of manipulating statistics, the authenticity of the reported economic data has always been questioned.

With the central government struggling to "save the economy" effectively, as year-end approaches, the premier, vice premiers, and state councilors have been deployed to various regions for "inspections."

The official narrative describes these visits as "urging guidance" and "increasing efforts to implement incremental policies," each focusing on different areas. All emphasized the need to "promote continuous economic recovery and strive to achieve the full-year economic and social development targets."

Commentator Li Linyi noted that China's economic crisis is severe, and Xi Jinping's target of 5% growth set at the beginning of the year is now unreachable without facing embarrassment. With only limited time left, it is difficult to fabricate numbers that align with this goal without exposing falsehoods, hence the urgency. The problem lies with a lack of talent and solutions at the central level, and local governments show little enthusiasm, with "lying flat" attitudes persisting. Visits from high-ranking officials to local areas may have limited results, prompting Xi himself to step in and apply pressure.

U.S.-based political scientist Wang Juntao previously told Epoch Times that Xi aims to lead the world by fostering "new productive forces," evidenced by China’s push in electric vehicles and solar products that have pressured global markets. However, ordinary Chinese citizens are struggling, and while markets elsewhere show recovery, China's stock market is in disarray, severely impacting the economy and livelihood. There are pragmatic factions within the CCP advocating for addressing key bottlenecks in the economy, but these bottlenecks are largely a result of Xi's own policies.

In the U.S., Trump has been re-elected president and previously proposed imposing tariffs on over 60% of Chinese imports and ending China's most-favored-nation trade status.

Ding Shufen, Honorary Professor at Taiwan’s National Chengchi University’s College of International Affairs, told Epoch Times that the upcoming trade conflicts from U.S.-China tariff wars will likely lead to a significant reduction in Chinese exports. Coupled with the EU’s gradual increase in tariffs on Chinese products, China's economy will suffer severely. Under the "state advances, private sector retreats" model, Xi's focus remains on "new productive forces" as the priority for resource investment, discouraging consumer spending. Real estate and local government debt remain unsolvable in the short term.

Editor: Li Renhe