Bellerbys Economics - Mr Stephenson

Monday, March 17, 2008

China's New Economic Head

China's new economic head is Wang Qishan. Zhou Xiaochuan will be keeping his job as Head of the Bank of China but will now presumably report to Mr Wang as China's central bank does not have independence from the Government.

Wang Qishan's key task will be the fight against inflation (now 8.3%) which he hopes to achieve without reducing economic growth by smoothing out 'bumps' in the supply-side of the economy.

Wang's reputation is impressive. He was number 2 to Zhu Rongji in the 1990s. Mr Zhu is still revered as the mastermind of China's economic miracle, rescuing an economy that was collapsing in 1994 with inflation at 27% following a period of rapid demand-side growth in the wake of the Tiananmen incident. Wang Qishan is also a popular former mayor of Beijing and a former governor of the Chinese Construction Bank, one of China's big four banks that specialises in large infrastructure projects. He also happens to be chairman of the organising committee for the Beijing Olympics - a very busy man!

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