China’s charismatic new leader has his work cut out – economic output quadrupled under the tenure of outgoing president Hu Jintao. But investors hopeful that Xi Jinping and the others in the new seven-member standing committee – the nexus of power at the centre of the Communist party – will bring bold reform are likely to be disappointed.

True, the new leadership’s aim to double gross domestic product in real terms by 2020 from 2010 will support more sustainable growth – roughly 7 per cent per year. But it hopes to double household income during the same period. To achieve that, China must reduce its dependence on wasted infrastructure investment and dilute the influence of China’s 145,000 state-controlled enterprises to encourage private sector development. The biggest blow therefore is that Wang Qishan, well-known as an economic reformer, has been given the second lowest-ranked position in the committee to head anti-corruption. The fear is that the largely conservative leadership will be left pushing for more of the same.

Revenues at two of China’s biggest state enterprises – Sinopecand China Mobile– multiplied almost eight times over the past decade, twice the rate of economic growth. Only in sectors where state giants are absent has private enterprise flourished. Revenues at internet company Tencent, for example, multiplied more than 580 times. The rest of the private sector is struggling. Banks in Wenzhou, the hotbed of private enterprise, have non-performing loan ratios three times above the national average.