The Chinese central bank is quietly considering a change that says a great deal about the progress and perils of China’s broader reform project. According to Caixin, Beijing may abolish the nine regional branches of the People’s Bank of China, each of which oversees several provinces, and replacing them with more than 30 provincial-level branches – effectively returning to a system it abandoned in 1998. The plan is expected to kick in by the end of the year.
Now, we realize that a bureaucratic overhaul in China is not very dramatic. But as we discussed following President Xi Jinping’s overhaul of the state bureaucracy during the spring, Xi is in a make-or-break wrestling match with the system he heads, and there are still several rounds to go. China is a big and unwieldy place that’s ill-suited for micromanagement. Chinese history is littered with sclerotic, unresponsive governments getting blindsided by crises bubbling up from the provinces. And if the Communist Party of Chin