Raby suggests that it now matters very much what colour the cat is. But there is a strong case to suggest that Deng’s observation that “socialism is not poverty” plays a far more important part in President Xi’s approach, especially if you remember that Xi spent his youth as a student sent down to the countryside.
China’s capital markets seem to be undergoing a sustained change in recent months. In spite of this, we need to try to put these recent moves into a broader context to understand if they are a threat to investments, a major change or just a readjustment of policy.
The initial reaction was that President Xi Jinping was hell-bent on destroying the Chinese capitalist model. Former Australian Ambassador to China Geoff Raby has argued that these changes represent a shift away from former Chinese leader Deng Xiaoping’s declaration: “It doesn’t matter whether a cat is black or white — so long as it catches mice”.
