- Pan Gongsheng Appointed as New Governor of China’s Central Bank.
- Economic Challenges Post-Pandemic: Sluggish Growth, Housing Crisis, and Youth Unemployment.
- Pan Gongsheng’s Track Record in Crisis Management Recognized for the Role.
Pan Gongsheng has been appointed as the new governor of the People’s Bank of China (PBOC).
The appointment of the 60-year-old comes as the nation continues to face significant economic challenges in the aftermath of the coronavirus pandemic.
Among the issues confronting the world’s second-largest economy are sluggish growth, a housing market in crisis, and record-high youth unemployment.
Mr. Pan succeeds Yi Gang, who has served as the PBOC’s leader since 2018.
According to some analysts, the promotion of Mr. Pan, who is not regarded as a close ally of President Xi Jinping, demonstrates the government’s recognition that it requires an experienced economist with a track record in crisis management to guide the nation through its economic problems.
The governor of the People’s Bank of China is among the most influential figures in China’s financial system.
However, compared to the governors of other major central banks, the PBOC governor’s authority is limited because the Communist Party controls the central bank.
In October, the Chinese Communist Party reshuffled its leadership to address the country’s post-pandemic economic difficulties.
When Mr. Yi was removed from the party’s central committee and was approaching the official retirement age of 65 for high-ranking officials, it became clear that he was preparing to leave his position as governor.
Trivium China senior analyst Andy Chen said Mr. Pan didn’t seem like the PBOC’s next leader.
Mr. Chen said the Chinese government appeared to have admitted it “lacks a deep bench of well-trained financial technocrats.”
During a crisis, “Pan is known as a competent, skilled, and outspoken technocrat who will not hesitate to push policy proposals to the very top of China’s policy-making apparatus,” he added.
Since 2012, Mr. Pan has served as deputy governor of the PBOC. He was appointed State Administration of Foreign Exchange Administrator in 2016 to manage the country’s $3.2tn (£2.5tn) foreign reserves.
He became central bank Communist Party chairman earlier this month, allowing him to become governor.
In 1993, Mr. Pan earned his Ph.D. in economics from the Renmin University of China.
After that, he was a Cambridge University visiting scholar and Harvard Kennedy School of Government student.
Mr. Pan made a name for himself in China by working for state-owned banks with distinction. In 2016, he was also attributed with aiding in the management of a currency crisis.
During his tenure as head of China’s central bank, Mr. Pan has tightened restrictions on real estate speculation and warned of an impending housing crisis that is now harming the Chinese economy.
His promotion to head of the PBOC is part of a larger reorganization of China’s economic leadership.
Li Hefeng, a longtime supporter of President Xi Jinping, was placed in command of China’s economic policy in March. The move signalled President Xi’s desire to tightly manage the economy.
The political leadership of China has been cautious to downplay the severity of the country’s economic challenges, and measures to stimulate the economy have been limited.
“Mr. Pan’s reputation is one of regulation and conformity. According to Dan Wang, chief economist at Hang Seng Bank China, he is quite aware of the need to limit financial hazards”.
I am confident that monetary policy will undergo a significant shift in the coming months. Maintaining economic stability remains fundamental. There will be more expansionary monetary policy, but it won’t be as aggressive,” she predicted.
