China Leadership Monitor

The Scramble to Maintain Growth

Friday, January 9, 2009

The reversal of economic conditions China has undergone since mid-year 2008 has occurred with a speed and thoroughness rarely, if ever, seen in history. In July, policymakers were still concerned with legitimate worries about inflation and overheating. By the end of October, they were scrambling to cope with an alarming economic slowdown. Given the centrality of economic growth to Chinese social and political equilibrium, policymakers returned to an intense focus on economic growth. The Chinese political system then did what it arguably does best: It concentrated policymaking resources on the most critical priority, in this case, propping up economic growth. By the time of the postponed Economic Work Conference (8–10 December), the entire apparatus of Chinese policymaking had been concentrated on the practical elaboration of a multidimensional and multiphase stimulus package. The leadership has been united on this push.