This week, the Standing Committee of the National People's Congress appointed a new governor of the People's Bank of China (Central Bank). Pan Gongsheng replaces Yi Yang as head of the institution; Yi Yang is retiring after reaching the maximum age limit set by regulations. 

Gongsheng had been appointed a few days earlier as the Communist Party secretary at the bank, a move that analysts say strengthens his power. The two positions had not been held by the same person since 2018.

Who is Gongsheng? He is a technocrat with extensive experience in China’s financial sector who has spent 11 years at the Central Bank. The new governor has conducted research at Harvard and Cambridge universities and has excellent connections with the leaders of other central banks. 

His appointment is seen as a strategy to ensure continuity in the bank’s and the government’s policies, which aim to revive the Chinese economy, which has been losing momentum in recent months, and represents a technical approach to managing the institution, which has been implementing an interest rate system that is more closely aligned with a market-based one.

Analysts estimate that Gongsheng, who worked alongside his predecessor to drive reforms in the financial and foreign exchange sectors, will continue on that path of reforms to liberalize the financial and foreign exchange markets and promote the gradual opening of the capital account.