18 BARRON’S November 22, 2021 November 22, 2021 BARRON’S 19

AsChinachangescoursetoemphasizebroaderprosperityoverrapidgrowth,

theimpactwillbefeltworldwide.Ourpanelistshighlighttherisksand

opportunities for investors—and 13 compelling stock picks.

ILLUSTRATIONS BY STEPHAN SCHMITZ

CHINA’S NEW

DIRECTION

INTERNATIONAL ROUNDTABLE

BY RESHMA KAPADIA

C

hina is undergoing a sweeping transition as President

Xi Jinping tightens his control and shifts the country’s

focus from growth to resilience. The resulting changes,

occurring as the Communist Party rings in its 100th anni-

versary, will ripple across the world economically and

geopolitically, requiring a new guidebook for investors.

A regulatory crackdown on China’s best-known

companies, such asAlibaba Group Holding(ticker: BABA) and

DiDi Global(DIDI), as well as for-profit education providers such

asNew Oriental Education & Technology Group(EDU), has

been a wake-up call for investors, and contributed to a 13% decline

this year in the MSCI China index. Beijing’s new emphasis on

“common prosperity” to tackle rising inequality, and its efforts to

rein in China’s debt-laden property sector and meet carbon-emis-

sion targets, have also roiled its economy and stock market,

pushing giant property developerChina Evergrande Group

(3333.Hong Kong) to the brink of bankruptcy and sparking the

country’s worst energy crisis in at least a decade.

The first formal summit between President Xi and U.S. President

Joe Biden helped cool the rhetoric that had sent the U.S.-China rela-

tionship to its nadir during the trade war started by the Trump

administration, but it also underscored the intensifying competition

between the two countries. U.S. military officials are warning of

China’s growing nuclear capabilities, while China’s claim on the self-