Trump Muddies an Already-Chaotic Debate in China
A possible second term is adding to disagreement over the size of China’s fiscal stimulus and how it should be spent.
Xi and Trump at Mar-a-Lago in 2017.
Photographer: Jim Watson/AFP/Getty Images
They might have to meet again. As President Xi Jinping decides on the size of China’s stimulus package, he has to consider the possibility that Donald Trump, who started a trade war in 2018, may soon be in the White House for a second term.
After Xi’s policy pivot in late September to meet his economic growth target of 5%, investors are looking at the gathering of the Standing Committee of the National People’s Congress, usually held in late October. Concrete details have so far been largely lacking, pausing the enthusiasm of markets. In 2023, Chinese legislators increased the government’s fiscal deficit, the first intra-year revision since 2000, in a tacit acknowledgment that the post-Covid economic recovery was stalling. Investors will be hoping for considerably more this year.