Shocking decision by China: Central bank governor and finance minister stay on

China has retained its central bank governor and finance minister at the annual parliamentary session, prioritizing continuity amidst economic challenges both domestically and internationally. President Xi Jinping, who is beginning a third five-year term and has been installing his allies in key roles, has broken with tradition by retaining Yi Gang and Liu Kun in their positions despite both reaching the official retirement age of 65.

The appointment of these officials signifies an emphasis on stability and credibility during this critical time for the Chinese economy. Despite the government setting a 2023 economic growth target of around 5%, up from 3% last year, there are deep structural issues and problems within the Chinese economy, according to Kang Yi, the head of China’s statistics bureau. This third administration must address these issues and implement necessary reforms to ensure long-term competitiveness.

Furthermore, China faces the challenge of reviving the economy after three years of COVID-19 restrictions, weak sentiment from both consumers and businesses, and increasingly antagonistic relationships with the West. There were also additional appointments made at the parliamentary session, including the appointment of Li Shangfu as defense minister, who is currently sanctioned by the United States over the purchase of Russian weapons.