Analysis: Why is China not rushing to fix its ailing economy?
By Laurie Chen and Yew Lun Tian
BEIJING (Reuters) — With China at risk of tipping into prolonged stagnation and a spiralling property crisis threatening financial stability, there is growing unease over why its leaders are not rushing to revive the world's second-largest economy.
Even in a country known for opaque and drawn-out decision making, investors, analysts and diplomats are pointing to signs that Beijing seems hesitant to deliver the bold policies needed to prop up an ailing post-COVID recovery.
This is not just an economic problem but a geopolitical one.
U.S. President Joe Biden — at loggerheads with China over hot-button issues like Taiwan, the democratic island Beijing claims as its own — last week called China a «ticking time bomb» due to its economic ills. «That's not good because when bad folks have problems, they do bad things,» Biden said.
So why has China's response been so tepid?
The view of several China watchers is that President Xi Jinping's focus on national security is restricting and working counter to the economic effort, scaring off the money Beijing says it is seeking to attract.
«The core problem this year is that the leadership has given vague, high-level instructions for officials to balance economic development against national security,» said Christopher Beddor, deputy director of China research at Gavekal Dragonomics.
«If officials are unsure what the leadership wants them to do, they're likely to put off any action until they receive more information. The result is policy paralysis, even if that comes at a substantial cost.»
Others say the Communist Party's ingrained hesitancy towards measures that could shift power from the state to the private sector, and a government stacked with
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