It is an organization whose objective is the financial surveillance of the country. It will be under the orbit of the Communist Party, which reinforces the role of Xi Jinping’s leadership.
After the heavy blow of Silicon Valley Bank (SVB), China seems to have the key so that the contagion effect does not arrive, or at least is slight. To do this, you will create a financial watchdogdirected by the communist partyas part of a sweeping shakeup of government bodies aimed at giving the ruling party direct control and supervision of financial affairs.
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China shields itself from the contafio effect
According to local media, it is about the creation of the Central Financial Commissionwhich entails the dissolution of the Financial Stability and Development Committee (FSDC). It is a powerful body created in 2017 and led by the former vice-premier, Liu He, to curb the risks of the Chinese financial system.
The new watchdog will handle design, development and supervision at the highest level of the financial sector, reinforcing “unified leadership over financial work,” according to a plan published by state media.
To reinforce the political role of the party in the general financial system of Chinaan independent Central Financial Work Commission will also be created.
The reorganization of the financial organisms of the party and the State takes place after Xi Jinping won an unprecedented third term as party leader in October and also a new term as president earlier this month, making him the most powerful leader in Chinafrom Mao Zedong.
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financial wall of china
“The line between party and government has decisively blurredso it is impossible for the new financial watchdogs to contradict what the party wants,” he said. Yan Wangchief China strategist at Alpine Macro, a Montreal-based global investment firm.
The revival of the high-level oversight body comes as Chinese leaders scramble to reinvigorate the world’s second-largest economy, battered by three years of heavy COVID-19 restrictions, a long decline in the real estate sector and weak external demand for the country’s exports.
“From the point of view of investors, andThe short-term impact of the regulatory review is unlikely to be significant. Promoting growth is clearly Beijing’s top priority, so it is unlikely to disrupt the market and hurt the economy with drastic policy changes,” Wang said.
Source: Ambito
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