Mr. Guo’s appointment offers a sign that China is taking a financial overhaul seriously, though it was made among other moves that could send mixed signals about that commitment. The stakes are high: Experts widely believe that China’s weak financial system is holding back its economy, the world’s second largest.
China is trying to broaden its economy beyond its traditional dependence on manufacturing, but its financial system still operates on a state-directed lend-and-spend model that has generated alarming amounts of debt even as it hinders money from reaching entrepreneurs.
Bad loans are widely expected to soar as the economy continues to slow. At the same time, banks have become increasingly dependent on raising money through often speculative investment products that they keep off their balance sheets, making it hard to assess the risks they pose to financial stability.
Yet other appointments suggested a commitment to the status quo. The state news media on Friday said the No. 2 officials at the National Development and Reform Commission, China’s top economic planning body, and the Ministry of Commerce, which oversees trade, among other things, were named to succeed their retiring bosses, who were also 65.
The choice to run the National Development and Reform Commission, He Lifeng, served from 2009 to 2012 as the deputy secretary of Tianjin. He helped oversee the construction…