The Securities Association of China (SAC), an industry watchdog, issued a directive last week urging chief economists at Chinese brokerages to “play a positive role in interpreting government policies and boosting investor confidence,” according to the state-run financial newspaper Securities Times.
The statement did not clarify what constitutes “inappropriate comments,” but it warned that individuals who “repeatedly trigger reputational risks due to inappropriate comments or behaviors” or cause “major adverse effects” within a specified timeframe could face serious consequences, including termination.
This directive represents Beijing’s latest effort to restore investor confidence and stimulate economic growth in the world’s second-largest economy. However, some analysts and economists express concerns that increasing censorship might heighten the risk of policy missteps.
Nikkei Asia reported that a Chinese economist working at a bank recently received an internal warning for public comments on the economy. According to SAC guidelines—supervised by the China Securities Regulatory Commission (CSRC)—chief economists are prohibited from attending meetings, events, or making public statements without prior approval from their firms. The guidelines also stipulate that brokerage firms should avoid hiring economists with a “spotty track record.”
The warning comes weeks after candid discussions by prominent economists Gao Shanwen and Fu Peng sparked social media debates on the reliability of official economic indicators, including unemployment rates and growth statistics. Following their viral remarks, access to their social media accounts was restricted.
China’s post-pandemic economic recovery has underperformed expectations, leading to debates about whether the economy is nearing recession. In 2022, the country’s official growth rate was 5.2%, its slowest since 1990, excluding the years of COVID-19 disruptions. During the annual economic work conference last year, Beijing urged officials to uphold a “bright theory” of economic conditions amid challenges like a property market downturn and declining stock values. The government also restricted negative commentary on the economy, labeling such rhetoric as “false.”
Since September, Chinese leaders have introduced a range of stimulus measures to restore confidence. These include lowering interest rates, reducing mortgage costs, and offering low-interest loans to encourage stock buybacks. However, these efforts have had limited impact. Consumer inflation dropped to a five-month low in November, exports experienced a sharp decline, and imports fell unexpectedly.
At a key political meeting this month, Beijing announced plans to boost domestic demand and increase fiscal spending through additional borrowing in 2024. The government is also preparing for potential trade shocks as former U.S. President Donald Trump, who has threatened to raise tariffs on Chinese goods, gears up for a second term.
Despite ongoing challenges, officials maintain an optimistic outlook. Han Wenxiu, Vice Chairman of the Central Committee for Financial and Economic Affairs, stated earlier this month that China’s economy is projected to grow by around 5% in 2024.
