Hong Kong CNN  — 

Chinese President Xi Jinping has opposed the lifting of curbs on street vendors in Beijing, signaling splits within government over a policy shift aimed at tackling rising unemployment.

In a recent tour of the Xiongan New Area, a city south of Beijing, Xi unusually revealed his personal views about the “street stall economy,” according to a report earlier this week by China’s state-owned Xinhua news agency.

“The capital city is first and foremost a political center, not a ‘hodgepodge’, where ‘factories in alleys’ and the ‘street stall economy’ are not allowed,” he said.

It’s the first time the top Chinese leader has spoken out publicly against recent efforts to revive the “street stall economy,” a policy that many cities have touted as a way to reinvigorate small entrepreneurship and create jobs as urban youth unemployment hits record highs.

It’s unclear whether the capital must now comply with Xi’s views and outlaw street vendors once again.

Beijing, a mega city of 22 million people, is one of dozens of major cities including Shenzhen and Shanghai, that have relaxed curbs on street vendors over the past few months after years of sometimes violent campaigns against hawking. City authorities are encouraging people to set up street stalls or carts in certain areas, where they can sell local specialties, snacks, clothes or toys.

The lifting of restrictions came after Zibo, a formerly little known factory town, became a viral sensation for its outdoor barbecue stalls, inspiring other cities to try to copy its success.

When China was in the midst of a pandemic-induced economic slump in 2020, then Premier Li Keqiang touted the idea of creating jobs by encouraging street vendors to set up shop across the country. That pitch was quickly shot down by close associates of Xi, who characterized the traditional trade as “unhygienic and uncivilized.”

Public discussion about street vendors also faded after major cities, including Beijing and Shenzhen, made clear that hawkers were not welcome there.

Analysts said then that street hawking was something Xi did not like, as it was seen to tarnish the image of a successful and modern China. The idea of vendors flooding the streets of metropolises was also at odds with his vision of China as an advanced, high-tech superpower.

But the recent policy reversal was made against a backdrop of growing challenges facing the world’s second largest economy.

The country’s jobless rate for 16- to 24-year-olds hit a record high of 20.4% last month, after three years of pandemic restrictions hit small businesses hard. A regulatory crackdown has also wiped out tens of thousands of jobs in the education and tech industries.

Street vending, according to analysts, is a pragmatic way to tackle pressing issues in the short term, as it allows jobless or under employed people to make a living.