Shanghai is the city with the highest GDP in the entire country and also its premier financial center. These people have a lot of power and seriously screw with the growth of the economy. One example is pension/retirement fund, which has become a hot topic recently. Because China cannot print money at will (and also the pension fund cannot be used in stock investment like you’d see in the US), it has to generate growth/revenues to finance the pension payout - there is some calculations floating around that the country will run out of its ability to pay retirement salaries to an increasingly aging population by 2035 if it cannot sustain a continuous growth at 5% over the next 10 years. This is why China is so obsessed with GDP growth even though we all know it’s just a number, and why they had to raise the retirement age recently.
All this can be solved by the central bank directly printing money, but that’s not the model they’re going after.
Shanghai is the city with the highest GDP in the entire country and also its premier financial center. These people have a lot of power and seriously screw with the growth of the economy. One example is pension/retirement fund, which has become a hot topic recently. Because China cannot print money at will (and also the pension fund cannot be used in stock investment like you’d see in the US), it has to generate growth/revenues to finance the pension payout - there is some calculations floating around that the country will run out of its ability to pay retirement salaries to an increasingly aging population by 2035 if it cannot sustain a continuous growth at 5% over the next 10 years. This is why China is so obsessed with GDP growth even though we all know it’s just a number, and why they had to raise the retirement age recently.
All this can be solved by the central bank directly printing money, but that’s not the model they’re going after.
it needs to be