Young China Watchers

On May 30, we invited Dr Victor Shih, UC San Diego professor and expert on China’s political economy, to discuss the outcome of the Two Sessions of the 2020 National People's Congress (NPC). Dr Shih shared three takeaways. In part I of this double episode, Dr Shih covers the decision by the Central Government to focus on supply-side stimulus and subsidies targeted at new economy and technology sectors, as opposed to demand-side stimulus seen in the U.S. and some European countries. With a drop-off in global consumption due to locked-down economies, many Chinese factories will struggle to find markets for their goods — even with increased production capacity. Additionally, the collapse of fiscal revenues at the local level result in inadequate government action. With potential blind spots in current government measures, some kind of demand-side relief is inevitable if the reces