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American Focus > Blog > Economy > Is China waking up? – Econlib
Economy

Is China waking up? – Econlib

Last updated: February 17, 2025 11:21 am
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Is China waking up? – Econlib
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China’s Economic Shift Towards Market-Oriented Policies

Over the past decade, China has gradually moved away from its previous free market reforms towards a more statist economic model. However, recent reports from Bloomberg suggest that China may be willing to embrace a somewhat more market-oriented policy regime.

Chinese President Xi Jinping recently met with Alibaba co-founder Jack Ma and other prominent entrepreneurs, signaling Beijing’s support for the private sector, which is now seen as vital for revitalizing the world’s second-largest economy.

President Xi pledged to eliminate unreasonable fees and fines imposed on private firms, aiming to create a level playing field in a state-dominated system. Additionally, China’s parliament announced a review of laws focused on promoting the private economy.

“It is crucial to remove obstacles to fair competition and equal access to production factors,” Xi emphasized, highlighting the need for fair market participation and addressing financing challenges faced by private enterprises.

The stock market in China has responded positively to this shift in policy, experiencing a significant rally as a result.

This shift in economic policy not only benefits Chinese investors but also the broader public and the global economy as a whole.

It is worth noting that China’s move towards statist economic policies had been accompanied by a more nationalistic foreign policy stance. It is hoped that this shift towards market-oriented policies will also influence a more internationalist outlook in foreign affairs. Countries that embrace free markets tend to exhibit a more cooperative approach towards international relations. While this is not always the case, there is a strong correlation between economic policies and foreign policy behavior.

See also  Trump's Fed pick wanted to upend its protection from politics

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