Slowing economy, unemployment weigh on China’s upcoming annual parliament sessions

Asia

BEIJING: About an hour’s drive from downtown Beijing, on the outskirts of the city – lies the Dong Xin Dian neighbourhood that’s home to many of the city’s migrant workers from all over China.

Regarded as the poorest of the poor, many are feeling squeezed out after the government sought to cap the population in the Chinese capital by demolishing many homes or vast areas of what it called “illegal structures”.

With bills to pay and families to support, many spend time waiting for news of odd job vacancies.

Beijing neighbourhood Olivia Siong (2)
Job ads pasted on a wall at Dong Xin Dian neighbourhood on the outskirts of Beijing. (Photo: Olivia Siong)

The ongoing trade war between China and the United States couldn’t be further from their minds.

READ: Much to be done on China trade: US trade representative

“This is not something that bothers me,” said 48-year-old Mr Hong Xiao Bing, who was sitting outdoors on a pile of rubble – the remnants of demolished homes.

“I can’t be bothered with it. We can’t even resolve our own livelihood, would we still worry about this? I can’t be concerned about anything else.”

Beijing neighbourhood Olivia Siong
Dong Xin Dian is home to many of Beijing’s migrant workers. (Photo: Olivia Siong)

Mr Zhao Gui Feng who runs a fried noodles stall in the neighbourhood adds that business has taken a hit, as he estimates about half of the migrant workers living there have left.

Many have gone back to their hometowns after not being able to find work in Beijing.

The 39-year-old say he too may return to his home in Shandong province to find work, if the situation does not improve.

“I just run a small business, (the trade war) has little to do with me,” said Mr Zhao.

Beijing neighbourhood Olivia Siong (1)
A vendor in Dong Xin Dian neighbourhood on the outskirts of Beijing. (Photo: Olivia Siong)

They may not think so, but the weaker labour market and higher unemployment means that jobs are harder to come by.

This comes as the trade war between Washington and Beijing ripples through industries from logistics to automobiles and technology.

READ: China factory activity hits lowest level in three years

Concerns about employment have risen due to pressures on the economy both domestically and on the external front.

The Chinese Academy of Social Science, a top government think tank, has forecast growth to slow to 6.3 per cent this year. That would be the weakest in 29 years.

This year’s annual parliamentary sessions in China, due to start on Sunday (Mar 3), will be closely watched for any fresh policy steps to ward off a sharper slowdown in the world’s second-largest economy.

Some Chinese government advisers and think-tanks are calling for faster economic reform.

“It does open up for dissatisfaction among the Chinese populace but I think the dissatisfaction comes out not in specific criticism of the party or with Xi Jinping, but in dissatisfaction with medical healthcare provisions, education and the environment,” said Ms Eleanor Olcott, China policy analyst at TS Lombard. 

“These are all issues the government is trying to introduce policy on. The extent to which they will be effective in addressing the real issues is another matter.” 

She added that the government will try to push forward policies on healthcare, education and the environment at the National People’s Congress to combat the negative effects of a slowing economy on the populace.

READ: The sorry state of the world economy, a commentary

Chinese President Xi Jinping prepares to leave at the end of an event marking the 40th anniversary
Chinese President Xi Jinping prepares to leave at the end of an event marking the 40th anniversary of China’s reform and opening up at the Great Hall of the People in Beijing, China December 18, 2018. REUTERS/Jason Lee/Files

President Xi Jinping has already called on officials to guard against so-called black swan and grey rhino events – referring to unforeseen events with extreme consequences and highly obvious yet ignored threats.

All as China faces a year of politically sensitive anniversaries in 2019, including the 30th anniversary of the Tiananmen incident in June.

“Political and social stability are President Xi’s chief concerns,” said Mr Liu Baocheng, Director of the Centre for International Business Ethics, at the University of International Business and Economics.

“So the China-US relationship is the most important in terms of international diplomacy both on the economic and political level, but it is also really a portion of the entire basket that President Xi will have to attend to.”

With so much at stake, China will be sure to look out for new economic engines. That, as well as its GDP targets for this year, will be the focus of the upcoming two sessions, or lianghui.

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