A well-known Chinese economist expressed skepticism about Beijing’s economic management at a seminar in Washington last month, speculating that the country’s economy may have expanded at a rate lower than half of the about 5% growth rate that officials have claimed.
However, Chinese dictator Xi Jinping reportedly became enraged upon learning of it.
The Chinese leader reportedly ordered a probe of Gao Shanwen, head economist at state-owned SDIC Securities, who has regularly provided the government with financial and economic policy advice.
Xi then gave the order for him to be disciplined.
According to the persons, Xi was enraged by two remarks made by Gao during the forum, which was organized by a Chinese think group and the Peterson Institute for International Economics.
The fact that Gao questioned Beijing’s capacity to take the necessary actions to support growth further enraged Xi.
According to those familiar with the situation, Gao was prohibited from speaking in public for an indefinite amount of time as a result of Xi’s directive.
They stated he has been permitted to continue working for the time being.
The way the leader responded to Gao’s comments reveals Beijing’s intense sensitivities on the economic problems that have gotten worse under Xi.
Beijing is attempting to allay concerns that China is about to enter a protracted recession.
The nation’s economy is being pulled down by a catastrophic industrial overcapacity that threatens a deflationary spiral, a property meltdown that has destroyed $18 trillion in household wealth, and a debt accumulation that is close to 300% of GDP.
Beijing’s attempts to demonstrate strength and get ready to take on tariffs and other threats from the incoming Trump administration are also hampered by the growing gloom.
Authorities have worked to silence any critical remarks regarding the status of the economy in recent months.
Zhu Hengpeng, a senior economist at one of China’s leading think tanks, was suspended, arrested, and fired last year after he allegedly made comments in a private chat group that were critical of Xi’s economic management.
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