By George
N. Tzogopoulos
During these particularly turbulent and uncertain times of the novel coronavirus disease (COVID-19) pandemic, the Chinese leadership has refrained from making predictions about the course of the nation’s economy as several contributing factors remain volatile.
As long as the pandemic persists, theoretical targets have to be constantly revised to account for new developments. The impact of COVID-19 on the tourism industry is a characteristic example of this uncertainty. The current difficulty in predicting China’s incoming and outgoing tourism while quarantine measures are still in place and with no vaccine yet makes reliable economic calculations impossible. Even if people are allowed to travel, will they overcome the psychological fear of the last five months?
The Chinese leadership prefers to be sincere instead of taking the risk of proposing a target that is unlikely to be met. What matters is not making vague prognoses but rather a specific capacity to solve problems and mitigate the economic consequences of COVID-19. From the modern Chinese philosophical standpoint, this means support for the national economy should be primarily centered around the wellbeing of people—as is the case when supporting the development of the public health system.
Centering economic development on the wellbeing of the people has been President Xi Jinping’s vision and that vision became a practical policy during this year’s full sessions of the national legislature and the top political advisory body, collectively known as the Two Sessions, in May.
Market-based employment, the Report on the Work of the Government delivered by Premier Li Keqiang asserted, is a priority to create 9 million urban jobs. This will help guarantee students graduating this year find work, that demobilized military personnel will be supported, and that rural migrant workers and citizens with capabilities will not be left behind.
An interventionist fiscal policy is widely considered the best remedy in challenging times. Vast fiscal spending itself, however, will only be temporarily beneficial if not accompanied by careful planning. China opted for taking targeted solutions. This is evident from both the content of Li’s report and his strong focus on tailor-made measures during a press conference on May 28.
These measures include increasing employment support, further cutting taxes and fees, reducing rents and interest on loans, and boosting consumption and investment. A prudent fiscal policy additionally requires the nation’s belt to be tightened and the Central Government has announced its commitment to immediately make cuts to all unessential items.
– The Daily Mail-Beijing Reviews News exchange item
