China’s Finance Minister resigns

Currencies, Economic growth, Financial Events

You may remember that the Chairman of Sinopec, Chen Tonghai, suddenly resigned last June. This prompted plenty of discussion about whether there had been a disagreement with the government over the level of subsidies paid to keep domestic oil product prices low.

Now, this morning, China’s Finance Minister, Jin Renqing, has also quit. There are suggestions that this reflects rising official concern over accelerating Chinese inflation and the surging stock market. The timing is also a surprise, coming as it does just 6 weeks before the 5 yearly Communist Party Congress, and is sure to prompt questions about possible policy changes.

However, according to AFX News, there is another side to the story, and the two resignations are linked. They quote a report in Hong Kong’s Ming Pao newspaper that says ‘Jin was sacked after he introduced a woman to Chen’, and she then became Chen’s mistress. They add that ‘the relationship between Jin and the unnamed woman was unclear’.

The role of Finance Minister in China is fairly critical in today’s global economy, as is the Chairmanship of Sinopec. One waits to see whether more will emerge about whether policy, or personal, reasons were behind these sudden departures. Do any readers have more information that they could share with us?

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