China Reappoints Central Bank Governor to Favor Continuity

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China recently brought back the same person to be in charge of the country’s main bank. They did this to calm people down and show that things will be consistent during a period of changes in their economy.

Yi is the leader of the People’s Bank of China, however he cannot make decisions regarding money like leaders in other major economies. His job is to do what was decided by a secret group instead.

The governor of the central bank is a very important person in finance. He speaks up on behalf of China’s economy and also helps bankers and investors feel better about their investments.

China’s economic growth recently dropped quite a bit, but there’s still hope! At the National People’s Congress earlier this year, they announced that they plan to encourage shoppers to help the Chinese economy starting now by aiming for an annual growth rate at around 5%.

Last year, China’s growth slowed down to only 3%, which was the second slowest it has been since 1970. This caused President Xi Jinping to feel a lot of pressure to try and make their economy stronger. Yi Gang was chosen as the new governor of the People’s Bank of China in March 2018 after his predecessor Zhou Xiaochuan, who had done a very good job.

Yi got his Ph.D. from the University of Illinois and was teaching economics at Indiana University from 1986 to 1994. After that, he spent 20 years managing the central bank until being promoted as governor. He is also a professor at Peking University’s China Center for Economic Research which he co-founded.

In 2013, when it was time for all the economic decision-makers to change, the party made a different decision and kept the same person as governor of the Central Bank (PBOC). This same person had already been in that job for 10 years.

At the last day of Congress, Yi’s position was re-confirmed as well as Xi’s supporters being appointed as Finance Minister and Head of the Cabinet Planning Agency. Their purpose is to keep control over business owners, reducing debt problems and promoting technologies created by the state. Wang Wentao remained his role as the Commerce Minister.

The congress also chose four people for the role of vice premier. Ding Xuexiang, who is in sixth place in the powerful party committee, will be responsible for important decisions. Besides him, He Lifeng, Zhang Guoqing and Liu Guozhong were chosen too – Liu and Zhang already had this post before.

Minister Qin Gang was promoted to the job of a state councilor, just like Wang Yi who is now his boss at the Central Foreign Affairs Commission.

Li Shangfu, an aerospace engineer, was chosen to be the Defense Minister of China. Along with him, Wang Xiaohong (Minister of Public Security) and Wu Zhenglong (Secretary General of the Cabinet) were also appointed as State Councillors. Shen Yiqin became the highest-ranking female politician in China as she got named for this position too.

However, it’s sad that none of the women are included in the 24-member Politburo or its Standing Committee since around 95% members of the Central Committee are male.

The government needs to manage how much money people and businesses owe on credit because they think it is too high. Restricting debt levels made the real estate business in China go down this year, which added even more trouble for the economy because of the pandemic.

The government is taking money from other places and putting it into developing new technologies and planning for the future. This has worried some people who fear that too much political control over these new businesses could lead to wasted money and bad growth.

President Xi Jinping prefers giving jobs to people who don’t have experience or knowledge of how global industry and finance work. He wants Chinese strategies without any foreign influence.

A reporter called Joe McDonald helped write this report.