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Can street vendors save China from a business crisis? Beijing looks divided

Last month, when China’s Prime Minister Li Keqiang – the second top official in China after President Xi Jinping – praised the city of Chengdu, he began to fight last month. To create 100,000 jobs overnight by building tens of thousands of street stalls, usually selling food, fresh vegetables, clothes and toys.

The government needs to do more to create new jobs “by breaking the stereotypes”. I said During a major annual political meeting in Beijing. “China has 900 million workforces. There are 900 million mouths that need to be fed unemployed. With jobs, there are 900 million pairs of hands that can create enormous wealth.”
The suggestion that street vendors might be the answer to China’s unemployment problem was not limited to Li’s comments at the meeting. Also mentioned on “Mobile sellers” annually government work report – It is Beijing’s priority for the year – for the first time since he took office seven years ago. Li continued to praise street vendors who gathered during the eastern visit of Shandong province.
Li’s message comes to the world in a stressful time second largest economy. China’s GDP from January to March shrank for the first time for decades. Unemployment rate also coronavirus pandemic started and informal analysis, 80 million people may have been unemployed this spring. Prior to the outbreak, officials said they had to create about 11 million new jobs each year to keep employment on track.
But in the Chinese state media, the reaction to Li’s field was fast and violent. State broadcaster CCTV will be “uncivilized” flow of street vendors in big cities. a comment piece Released online earlier this month. He criticized the Prime Minister in a similar way as “going back a few decades before the night”
And the official newspaper of the city government, Beijing Daily, blasted street vending machines noisy, obstructive and can damage the “image of the capital and the image of the nation”.

Printing for technology

The idea of ​​vendors that filled the streets of high-tech metropolises like Shanghai and Shenzhen partially caused controversy in China because Beijing has developed its image as an advanced global superpower for years. Xi’s The signature policy project “Made in China 2025” pushed the country to compete with the United States to penetrate future technologies through billions of dollars worth of investment.

“It’s something that Xi doesn’t like because the falcon on the street darkens the image of the successful and beautiful China he likes the project,” said Professor Steve Tsang, director of the SOAS China Institute, School of Eastern and African Studies in London.

In recent weeks, Xi has reiterated China’s long-standing pressure for high-tech solutions against economic hardships. He recently called on the country to invest in 5G networks and new generation satellites as part of its plan to increase economic growth and employment.

“Efforts should be made to promote innovation in science and technology and to accelerate the development of emerging strategic industries,” said Xi at a meeting with political consultants. Said. according to the state-run CGTN publisher.
Smartphones are on display at a Huawei store prior to its opening in Shanghai this month.

A harsh political reality

However, Ann Whitney Olin Xiaobo Lü, professor of political science at Barnard College, said Li’s idea was of value. China has set a goal end poverty at the end of this yearand Lü said that street sales and other modest work can “find ways to survive” people living just above the poverty line.

He also said that once implementing large, expensive infrastructure projects as a way to solve Beijing’s economic troubles, it may not be so effective.

China’s response to the last major economic shock – the 2008-2009 global financial crisis – involved investing heavily in highways, airports and high-speed rail lines. This time, this stimulus line was already saturated.

“In many ways measured by the holding per capita, China has achieved the status of a global leader,” wrote Zhu Ning, a finance professor at Shanghai Jiao Tong University and a faculty member at Yale University. Research report earlier this year. “Therefore, the need for infrastructure has changed drastically compared to 2008,” he added.

Zhu added that the recent financial crisis has left China with too much debt, making it important for the country to focus on private consumption this time.

Tang Min, a Chinese government adviser, recently told reporters in Beijing that street jobs will not only create jobs, but will also address concerns about indoor crowds amidst the ongoing epidemic.

“But it cannot replace the ‘normal’ economy – things that can be sold or bought on the streets are very limited,” Tang said. Said. “The government cannot allow it to grow uncontrollably – it needs to be regulated while continuing to try and research this option.”

At May’s annual political meeting, Li was blunted by China’s problems and to what extent some people might not participate in the country’s high-tech future. About 600 million Chinese people – about 40% of the population – earn an average of just 1,000 yuan ($ 141) per month.

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This makes the street vendor a “key source of employment” Li I said During his visit to Shandong province this month, he added that such jobs have made China “alive” as well as top industries. A state media news report suggested that removing restrictions on street stalls, such as allowing roadside trade in urban areas, could result in up to 50 million new jobs.

“Li is trying to find solutions with a realistic approach to emergencies.” says Professor Willy Lam at the China Research Center of the University of Hong Lam, China. While the street vendor approach is not perfect, it may not be a better alternative to create lots of jobs in a short time.

“Employment is an extremely important issue that can trigger political turmoil … Li is apparently concerned about the disastrous consequences of major job losses.”

A Uyghur man sells traditional flat bread to women shopping along Beijing's Xinjiang Street in 1999.

Tsang, director of the SOAS China Institute, said that Li was probably trying to control the country’s basic economic policies.

“Pandemic allowed the prime minister to play his deep-rooted role in managing the economy,” Tsang said. “He saw how the economic impact of Covid-19 required a pragmatic and more emphatic approach, so he allowed, or even encouraged, street sales to those who were brought up as a result of the pandemic.”

Local governments stand out

The public debate of Li’s pressure on street vendors in China has declined recently, with major cities including Beijing and Shenzhen clearly demonstrating that the policy is not welcome there.

But other local governments in less prosperous areas quietly push the idea forward. Lanzhou, the capital of northwestern Gansu province, is on Tuesday announced plans a plan he hopes will create at least 300,000 jobs – to install about 11,000 street vending machines.
Changchun, the capital of the northeast Jilin province, also supported this idea. The province’s Communist Party boss visited street food stalls in Changchun earlier this month, and according to the task, “low entry barrier” only for people who want to get a job Jilin state government.

“Street stalls won’t actually disappear altogether,” said Lam, professor at the University of China in Hong Kong. As long as unemployment was the biggest concern, he expected local governments to move forward with the plan.

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