China is grappling with fears of deflation due to sluggish consumer spending. The government is now pressuring economic experts to refrain from negative assessments of the country’s financial situation. On Friday, the Wall Street Journal (WSJ) reported that the Securities Association of China (SAC) recently issued a directive to its member financial firms urging them to tighten their chiefs’ oversight.
The association warned that should a chief economist’s inappropriate conduct or statements result in serious repercussions, the company must enforce severe disciplinary actions, potentially up to and including termination. Consequently, experts at major securities firms are now more cautious with their public commentary.
The SAC’s official statement emphasized that chief economists must accurately interpret and promote the Party and state’s policies, actively guide market expectations, and bolster investor confidence. Additionally, the association mandated enhanced pre-screening of public statements, requiring company approval before economists participate in meetings or make any public declarations.
While the SAC did not explicitly define grounds for dismissal, analysts suggest that the directive is linked to growing concerns over economic stagnation and government sensitivities. The Wall Street Journal noted that these guidelines are being introduced when the government has become increasingly sensitive to criticism, especially as public discontent grows amid recent economic downturns.
Some experts have faced government pressure to draw parallels between China’s current economic slump and Japan’s prolonged recession of the 1990s. An economist recently reported that their WeChat account had been blocked after discussing youth unemployment and economic contraction at a conference.
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