On March 11, 2018, 3,000 delegates gathered in the Great Hall of the People in Beijing and voted to abolish the two-term limit on the Chinese presidency. The vote passed almost unanimously with only two dissenting votes. This announcement was met swiftly by predominantly negative reports in the Western media prompting claims of “Chairman Mao 2.0” and fears that China would be returning to the dangerous days of strongman rule. In our view, Xi’s crystallization of power actually lowers the medium-term risk in China. His firm grip on power actually brings stability to the Chinese leadership which we have not seen since 2002 when Jiang Zemin retired as Chinese President and Party Secretary of the Chinese Communist Party. In other words, if you were sold on investing in China before, you should be even more gung-ho on investing in China today.
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