China’s 12th Five Year Plan, which was promulgated at the end of 2011 and is being executed by Xi Jinping’s administration starting last year is not a relic of the old days of Politbureaus and Cold Wars. It is a vitally important blueprint that has the imprimatur of the “people”. It determines promotion and ascension for all senior leaders. It is the administrative guidepost for the economy.
From the point of view of the financial system, the foundation of this 12th Five Year Plan is very simple. According to a McKinsey report, China’s Achilles heel is that unsecured bank loans are about 40% of total capital circulating throughout the...
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