Xi’s Reign May Outlast China’s Boom
When the Chinese government announced it would be ending presidential term limits in early March, investors seemed to welcome the news.
Xi Jinping’s goal of shifting the country’s exports-based economy toward domestic consumerism, say many China watchers, was always going to take longer than the President’s 10-year term. A number of U.S. companies have prospered there, even if equal footing in the country has been elusive. And at the very least, Xi’s now-indefinite reign ensures consistency. Many question the sky-high official GDP growth rates, but China’s boom has inarguably lifted hundreds of millions out of poverty .
Still, there is, of course, a darker side to the prospect of one man’s indefinite rule over a major world power. Economists caution that an increasingly authoritarian government could squash emerging dynamism within China’s economy. Xi will also have a freer hand to aggressively respond to U.S. tariffs and other policy moves, possibly increasing the likelihood of an economically destabilizing trade war. A lack of accountability could erode institutional trust and further curtail human rights, making the country’s systems—and markets in the world’s second-largest economy—more fragile in the long run.