New Chinese leadership

As China goes through a once a decade change of power, analysts and world leaders alike are trying to predict the possible global economic effects. China, with a population of 1.3 billion people (and growing), is the world’s second largest economy and the biggest engine of growth since the early 2000’s. Besides holding the world’s largest reserve of foreign exchange, China is also the holder of US debt. As such, a change of its leaders will have a considerable impact on the global economy.

Some issues facing the new Chinese leadership:

Economic environment. The current economic environment facing incoming president, Xi Jinping, is much harsher than the one facing his predecessor, Hu Jintao. The US economy is has been picking itself up slowly, but now faces the prospect of a fiscal cliff. UK is at risk of entering a triple-dip recession, with the outlook of Europe remains bleak. China itself has been in decline, no longer able to sustain a GDP growth rate above 10 percent. Recent reports on China has Siemens CFO, Joe Kaeser, saying that the decline has ‘bottomed out’, but a pick up in growth is unlikely.
International disputes with Japan. Call it an island or a rock in the middle of the ocean, Sino-Japanese relations are not expected to improve any time soon.
Social inequity. Some teenagers are photographed burning money online, while others survive on less than US$1 a day. The disparity might just rip the country apart from the inside out.
Corruption. The issue had been off the radar for a period of time, but recently surfaced again with the Bo Xilai case. Really makes you wonder what really goes on behind the closed doors in China.
Other issues (Environmental problems and carbon emissions, rigid education system, Tibet problems etc)

President Xi Jinping and Premier, Li Keqiang, have heaps on their plate. Let’s see how this plays out.

EW’s Man of the hour: Li Keqiang (the next Premier of China, and its top guy to lead the economy)
Though the man’s considered to be very liberal and reform-oriented, no major reforms are to be expected as they are largely hampered by the conservatives majority in the party.

The men in the spotlight: