BEIJING – China on Sunday reappointed central bank chief Yi Gang in a bid to reassure entrepreneurs and financial markets by showing continuity at the top as other economic officials reshuffle amid a period of uncertainty in the world’s second-largest economy.
Yi, whose official title is governor of the People’s Bank of China, plays no role in making monetary policy, unlike his counterparts in other major economies. His official duties lie in “implementing monetary policy” or carrying out decisions made by a political body whose membership is secret.
But the central bank chief acts as the monetary policy spokesman, is the most prominent Chinese figure in global finance and is charged with reassuring bankers and investors at a time when China’s economy is emerging from drastically slower growth.
At the March 5 opening of the annual session of China’s rubber-stamp parliament, the National People’s Congress, China announced plans for a consumer-led revival of the struggling economy and set this year’s growth target at “around 5%.”
Last year’s growth fell to 3%, the second-weakest level since at least the 1970s, putting President and ruling Communist Party leader Xi Jinping under extraordinary pressure to revive the economy.
A long-time veteran of monetary policy departments, Yi was first appointed governor of the People’s Bank of China in March 2018, succeeding the highly regarded Zhou Xiaochuan.
Before becoming governor, Yi spent 20 years at the central bank after earning his Ph.D. from the University of Illinois and worked as a professor of economics at Indiana University from 1986 to 1994.
He is also a co-founder and professor at Peking University’s China Center for Economic Research.
The party made a similar decision to opt for continuity in 2013, when then-PBOC governor Zhou, who had already been in the job for a decade, remained as governor while all other economic regulators changed.
Yi’s reappointment came on the penultimate day of the congress, where Xi loyalists were also appointed finance minister and head of the Cabinet Planning Agency to implement a program to tighten controls on entrepreneurs, reduce debt risks and promote state-led technology development. Incumbent Wang Wentao was reappointed Minister of Commerce.
Congress also appointed four deputy prime ministers, people who may be in line for higher office. They include a sixth-ranking member of the party’s all-powerful Standing Committee of the Politburo, Ding Xuexiang, as vice premier overseeing administrative affairs. Veteran bureaucrats He Lifeng, Zhang Guoqing and Liu Guozhong were also appointed to the post. Liu and Zhang were incumbents.
Foreign Minister Qin Gang was also appointed to the position of State Councilor, a position also held by Wang Yi, his predecessor and current superior as director of the Party’s Office of the Central Foreign Affairs Commission.
Defense Minister Li Shangfu, who is an aeronautical engineer, was also appointed as one of the five State Council members, along with Public Security Minister Wang Xiaohong and Secretary General of China’s Cabinet, known as the State Council, Wu Zhenglong. Shen Yiqin was the only woman appointed to the post and is China’s highest-ranking female politician.
No women sit on the 24-member Politburo or its Standing Committee, and the party’s more than 200-member Central Committee is 95% male.
A priority for finance officials will be dealing with corporate and household debt, which Beijing worries has risen to dangerous levels. Tighter debt controls triggered a decline in China’s huge property industry in 2021, adding to the downward pressure on the economy from the COVID-19 pandemic.
At the same time, the ruling party is trying to shift money to technology development and other strategic plans. It has prompted warnings that too much political control over new industries could waste money and stunt growth.
Xi has favored promoting officials who sometimes lack the experience of their predecessors and exposure to global industrial and financial markets. It reflects Xi’s efforts to purge the Chinese system of Western influence and promote homegrown strategies.