![]() ![]() International governments have noted Xi’s interventionist instincts with alarm. But in his first term in office, Xi has overseen a sea change in how the party approaches the economy, dramatically strengthening the party’s role in both government and private businesses. For more than a decade, the party has also tried to ensure it played a role inside private businesses. ![]() But as Nicholas Lardy, a US economist who has long studied the Chinese economy, concluded in a recent study, “Since 2012, private, market-driven growth has given way to a resurgence of the role of the state.”įrom the Mao era onwards, Chinese state firms have always had a predominant role in the economy, and the Communist party has always maintained direct control over state firms. At the time he took office, private firms were responsible for about 50% of all investment in China and about 75% of economic output. Since then, Xi has engineered an unmistakable shift in policy. W hen Xi Jinping took power in 2012, he extolled the importance of the state economy at every turn, while all around him watched as China’s high-speed economy was driven by private entrepreneurs.
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