Fearing political dangers, China spent years preparing for this economic crash
Official policy papers reflect Beijing’s awareness that this event not only would serve as a critical test of the Chinese Communist Party’s domestic rule, but also could reshuffle the balance of power among China and Western nations.
“After a big crisis, what is redistributed is not merely wealth within a country, but the relative power of all nations,” Liu He, China’s chief economic architect, who has since risen to vice premier, wrote in a 2013 study of recessions.
China reported a 6.8 percent drop in economic output for the first quarter, its first contraction on record since the death of party founder Mao Zedong in 1976. In recent weeks, President Xi Jinping has launched a New Deal-esque construction campaign, while touting poverty relief and investment in advanced technology to help jump-start coronavirus-hit factories and consumer spending.