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Opening a Can of Worms

Abstract

Opening the capital account is like opening a can of worms for Beijing’s senior leaders, as they would need to implement a whole range of deep-rooted structural reforms that could threaten the stability of the Communist Party. Why does China still want to walk into the Impossible Trinity and “suffer” the consequences? Do the Chinese leaders know what challenges and risks they are facing? One potentially detrimental risk is massive capital flight, which has its structural roots in the corrupted system that China’s senior leaders are aiming to rectify.

Keywords

Foreign Direct Investment Gross Domestic Product Capital Inflow Capital Account Foreign Direct Investment Inflow 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Chi Lo 2015

Authors and Affiliations

  • Chi Lo
    • 1
  1. 1.Economic StrategistHong Kong

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