To protect the economy in 2020, the government of China is willing to do whatever it takes. Ahead of it is an enormous task.
The world’s second-largest economy cannot spiral into a slump; Beijing has made that clear. It tangles with rising as risk mass layoffs. Also, there is an ongoing trade war with the United States and domestic cooling demand.
This year it is crucial because it marks the conclusion of the government’s 13th Five-Year Plan. During this plan, it promised to establish a moderately prosperous society. China wants to end poverty. There are senior members of the Communist Party’s Politburo. Last week the seven most powerful men in China said that all efforts are considering achieving those goals for 2020.
With a wave of stimulus measures in recent weeks, the government bombarded the economy. It ranged from rate cuts that could fuel more bank lending to tariff reductions that might help soothe the pain from rising prices.
To describe the situation, authorities are also amping up the langue they’re using. Last month China’s State Council called on local governments to “go to all lengths.” It happened to prevent massive job losses this year. To tackle enormous job losses is the country’s top policy priority.
If unemployment balloons, the country could face “massive unexpected incidents,” warned the chief administrative officer. This euphemism is massively understood as a referral to riots and social unrest. It is rare in public government documents. In recent years the government said that it must create 11 million new jobs annually. It is because to keep employees on track.
The Problems of China
Over the last several years, China’s official unemployment data has barely budged. It is hovering between 4% and 5%. China is worried about the challenge that the year could bring and the slowing economy.
Director of Transnational China Consulting Limited and a professor emeritus at the Hong Kong University of Science Technology is David Zweig. He said that Beijing is much more worried about social unrest than about ballooning local debt. At one point, ballooning domestic debt, seemed to be a priority.
After all, massive protests have for months consumed Hong Kong. Last November, local officials said that these protests would sink into its first annual recession in a decade. The prime reason for the demonstrations is calling for greater democracy. Nevertheless, particularly among the city’s young people, a growing sense of dissatisfaction has other rights too. For example, we can say an increasingly competitive labor market or the soaring cost of housing.
The country might be facing the “black swan” risk or social unrest, says the Zweig. The same phrase used Chinese President XI Jinping last year to describe the chaotic event of Hong Kong.
China’s political and adjunct associate professor at the Hong Kong University of Science and Technology is Frank Ching. He said that 2020 is going to be difficult. The most feared problem might mass unemployment. This economic issue might become a political one, he adds.
Mass unemployment may cause rising social tensions and generate more significant unrest.