November 2, 2017 / 9:28 AM / in 8 months

China Finance Minister Xiao Jie likely to step down after getting key Party role - sources

BEIJING (Reuters) - China’s Finance Minister Xiao Jie is likely to step down in coming months after he was promoted to a senior Communist Party job, government sources familiar with the matter said, part of a wider reshuffle following a key party congress in October.

Chinese Finance Minister Xiao Jie attends a groundbreaking ceremony at New Development Bank permanent headquarters building in Shanghai, China September 2, 2017. REUTERS/Aly Song

Xiao, 60, has been appointed as the head of party’s Work Committee of Central Government Departments, replacing Yang Jing, according to a post on the committee’s website on Wednesday.

Xiao has also been named as deputy secretary-general of the State Council, the cabinet announced separately on its website on Thursday.

Both jobs involve managing day-to-day operations of the party’s elite body and cabinet.

At the 19th Communist Party congress last month, Xiao was re-elected to the party’s 204-member central committee, the largest of its three elite ruling bodies, while Yang was left out.

President Xi Jinping packed the second-tier, 25-member Politburo with his allies while he continued to head a seven-member Politburo Standing Committee, the pinnacle of power in the country.

China has named top officials for its financial hub of Shanghai and the southern export powerhouse province of Guangdong, in a series of reshuffles as the party moves people into new party and government positions and as others retire.

The finance ministry’s website showed Xiao remains finance minister, but government sources said he is likely to leave the post early next year.

“He is holding the minister post concurrently according to the organizational procedure,” said a source, declining to be identified because he was not authorized to speak to the media.

A second source said Xiao is likely to step down, but it’s unclear who is likely to succeed him.

The ministry’s news department did not immediately respond to Reuters’s faxed requests for comment.

Xiao was appointed China’s finance ministry in November 2016, succeeding Lou Jiwei, who has been credited with reforms to put a lid on rising local government debt.

Xiao has maintained an expansionary fiscal policy since he took over from Lou, who now heads the nation’s social security fund.

Xiao, who had worked as China’s tax chief and a vice finance minister, moved to the ministry from the position as deputy secretary-general of the State Council.

Some media reports suggested Xiao, a capable bureaucrat, could become secretary-general of the cabinet, a position that is still held by Yang.

China is likely to name a new finance minister around the annual parliament meeting next March, the sources said.

Sources with ties to the leadership and close to the central bank had told Reuters that China’s central bank governor Zhou Xiaochuan is also likely to retire around the time of the annual session of parliament next March.

Reporting by Kevin Yao; Editing by Kim Coghill

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