Experts note that China’s economy was already under significant strain, with central and local governments stretching resources and maximizing every dollar.
Video script:
Amid the ongoing U.S.-China tariff war, the Central Committee of the Chinese Communist Party has revised and promulgated new austerity measures. The code of conduct requires party and government agencies throughout the country to “lead the way in modeling a frugal lifestyle.”
Scholars analyzing the move say that the Chinese economy had already been facing economic headwinds, with central and local governments stretching funds and squeezing the most out of every penny. The austerity measures, which go so far as to ban welcome banners and floral arrangements for official visits, reflect how dire the situation has become.
Further hints about China’s economy may be inferred from the fact that they spent about US$9.2 billion in loans on the China-CELAC forum this year, compared to the US$29.1 billion they spent hosting the event a decade ago. Taipei University of Marine Technology Assistant Professor Wu Se-chih (吳瑟致) said that the loan amount China proposed to Latin American countries this year is also significantly lower than the amount they proposed in 2015, suggesting that China’s overall economy and ability to allocate resources are malfunctioning.
Economist Li Heng-qing (李恆青) said that by imposing the measures, the CCP is exposing its own shortcomings, and that China’s financial situation appears to be stretched to its limit. While the new regulations are quite strict and granular, imposing rules about alcohol, cigarettes, and airport receptions, Li expressed doubts about their successful implementation. He said that the CCP has previously promoted anti-corruption measures and implemented them as part of the eight-point code of conduct to prohibit expensive meals, showy official trips, and other extravagances. However, as there have been few concrete results, Li said, whether the austerity measures can be enforced is questionable.
Li opined that changing the current state of affairs will prove difficult given the systemic lack of effective supervision and restraint mechanisms and the party’s tendency toward extravagance and corruption.