Japanese Media Offers Advice to Solve the Economic Crisis in China
In recent years, the superficial prosperity of China’s economy
has been used by the Chinese Communist Party (CCP) as proof of its ruling legitimacy.
The appearance of the money hungry mentality,
the economic crisis, along with the party’s ruling crisis, is drawing more and more public attention.
Recently, Japanese media published a commentary article
which suggested the CCP should take action on the “non-transparent system.”
Then, what is the “non-transparent system?”
Is China’s economic crisis avoidable?
What needs to be done to solve the crisis in China?
Recently, Japan’s Asahi Shimbun Newspaper published
a commentary article, saying that
the CCP has made a series of economy stimulating policies
after the “Lehman crisis” in 2008.
The policies were complemented for their large scale
and of fast implementation.
As a matter of fact, those policies haven’t gone well.
At the time being, based on the government’s instruction,
many places began investing in basic facilities and properties across the country.
However, local governments had to be responsible
for the funding.
Meanwhile, there are so many financing restrictions
Therefore, some securities companies took the chance
to issue high interest financing products.
Thus, even more money from state-owned enterprises
has also flowed into the financial market in China.
This financing method is called a “shadow banking system,”
which means opaque financing.
The article pointed out that investment, consumption
and exportation, all three economy drivers, currently lack momentum in China.
International communities worry that there might
be a time bomb embedded in China’s financial system
and suggest China take action on this “non-transparent
Xie Tian, Professor of Aiken Business School, University
of South Carolina: “Because of the non-transparent system,
the CCP’s various interest groups have already kidnapped
By means of inflation, real estate bubbles and stock market
bubbles have robbed China’s 1.3 billion people of their money.
Because of flaws in the law, those who trade illegally
and behind the scenes cannot be penalized.”
Xia Bin, Counselor of the State Council, wrote an article
stating that the economic crisis has already come to play in China.
Local government debt, real estate bubbles
and excess capital are intertwined.
As long as something happens to one segment of the chain,
risk will spread instantly to other areas.
Capital will shrink sharply and immediately, which will greatly
threaten the lives of middle class and urban residents.
Xia Bin stated that if people’s wealth is severely discounted,
the impact on the whole society and political stability will be huge.
Zhang Qingxi, Professor OF Economy from Taiwan University,
“It seems like a financial problem on the surface.
Nonetheless, the root cause is the problems in the regime.
The government has intervened with the market too much
and too profoundly, which has caused the loss of market function.
A lot of government central-controlled interference
has caused various after-effects.”
The CCP’s senior authorities are on edge when facing
the series of economic crises.
As reported by overseas media, Li Keqiang lost his temple
in one of the state counseling meetings.
He punched the table when his free market trade problems
in Shanghai was objected to by interest groups over and over.
What on earth should be done to solve
China’s economic problems?
Zhang Qingxi: “If the CCP wants to stimulate domestic
demand, it has to distribute national wealth more evenly among people.
However, since political power has intervened too much,
it would be very hard for it to make a root change because the party would disintegrate.
Without being democratized, those issues
can never be solved.”
With the appearance of the money hungry mentality,
the CCP’s fake GDP numbers are now failing to cover the disastrous state of the economy.
Mao Shoulong, distinguished research fellow
of China’s Economy System Reform Society: “It’s not only
about financial crisis, or unemployment rate.
It involves many aspects, from a long-term perspective,
some ideologies need to be changed.
In the past 30 years, was economic development
the most important value?
Are those other values that are not as relevant to
economic development not important at all?”
In recent years, Professor Xia Tian has firmly stated
China’s economy will have a hard-landing (fall into
recession rapidly), which now more and more economists are in agreeance of.