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28 November 2012, Gateway House

Deciphering China’s leadership transition

Rising income inequality, corruption and the ouster of former Politburo member Bo Xilai from the Chinese Communist Party were all significant aspects of China’s 18th Party Congress. However, the new leadership has committed to reforms and repeated that increased economic growth will be achieved.

Distinguished Fellow, Centre for Air Power Studies

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Growing popular discontent caused by a variety of factors (including corruption, rising income inequality, pollution and food adulteration) exacerbated by the severe disruption triggered by the uncontrolled ambition of a senior Party cadre with unimpeachable ‘Red Revolutionary’ lineage, provided the backdrop for China’s 18th Party Congress. It convened after a few hiccups amidst high security in Beijing from November 8-14, 2012. The developments cast a long shadow over the Congress, manifest in the new top leadership of the Chinese Communist Party (CCP).

A recent Pew Survey of over 3,177 respondents conducted in China between March 18 and April 15, 2012, confirmed the causes of discontent. There was general consensus that the economic gains have not benefited everyone equally. More than 80% agree with the statement that the “rich just get richer while the poor get poorer,” while 45% “completely” agree. Almost 48% – up from 41% four years ago – say the gap between rich and poor is a very serious problem. Corruption is a serious concern with almost 50% of those surveyed viewing corrupt officials as a very big problem. This is 11 percentage points more than in 2008. There is an identical percentage increase in those viewing business people as corrupt with 32 % identifying that as a serious concern. Consumer protection is another rising concern. While four years ago only 12% cited food safety as a major issue, in this survey their number had jumped to 41%. Adulterated medicines are yet another concern. More than 35% consider air and water pollution as serious matters. Interestingly, many Chinese worry about the current state and direction of their culture and traditions: 71% want to see their way of life protected from foreign influence and 59%, or 12% less than in 2008, say they like the pace of modern life. Naturally 73 % of the wealthier Chinese like modern life.

Former Politburo member Bo Xilai’s uncontrolled ambition and bid to enter the Party’s Politburo Standing Committee (PBSC) prompted him to try and co-opt the neo-Maoist sentiments spreading across China. He also tried to make inroads into the People’s Liberation Army (PLA), especially the 14th Group Army once led by his father, Bo Yibo, and the Chengdu Military Region. In the process, Bo Xilai began increasingly to be perceived as a potential alternate centre of power to the Party Centre. His ouster and the machinations leading to it spilled over into the public gaze attracting avoidable attention and public comment. The incident publicly highlighted the factionalism that existed within the Party, evidenced particularly by the inaction of the Party propaganda apparatus which waited to see which of the two contending factions would emerge stronger. The extent of influence acquired by Bo Xilai was noticed once Bo Xilai had been ousted. The Party Centre had to send 3000 public security cadres for “re-education” and at least five central teams to ascertain the political reliability of military personnel. The list of PLA delegates to the Congress was consequently delayed by some days. At least two prominent Generals, namely Liu Yuan and Zhang Haiyang, who were earlier tipped to enter the Central Military Commission (CMC), did not finally make it – apparently because of their association with Bo Xilai, though both are members of the 18th Central Committee (CC).

The Bo Xilai incident has had a visible effect on the selection of the Party leadership. The CCP leadership opted for entrusting stewardship of the Party to loyal, stolid Party apparatchiks. There was an obvious emphasis on continuity, loyalty to the Party, political reliability and dependability. The members of the PBSC – Xi Jinping, Li Keqiang, Zhang Dejiang, Yu Zhengsheng, Liu Yunshan, Wang Qishan, and Zhang Gaoli, all reflect this decision. Additionally, four of the seven members of the new PBSC, are members of the ‘Red Nobility’, or princelings. Incidentally, the same principle of political reliability over-riding other criteria was applied while making appointments to the top echelons of the Central Military Commission.

Significant indicators of future policy are Hu Jintao’s work report to the 18th Party Congress and Xi Jinping’s first speech on November 17, 2012, to the Politburo’s first collective ‘study’ session. Hu Jintao’s work report included references to Marxism-Leninism-Mao Zedong Thought, twice mentioned the ‘Four Cardinal Principles’ – a phrase coined by Deng Xiaoping but usurped by the

‘Leftists’ – and spoke of strengthening “core socialist values.” Though the Report mentioned reform 86 times, its emphasis was on “common prosperity” and economic policies that benefit peasants and rural folk. Taking note of popular discontent, an entire portion of the 12-part report was devoted to ‘social management,’ but it simultaneously addressed popular concerns. For the first time ever a work report contained a section on ‘Ecology’ and referred to the need for “resource conserving” and need for an “environmentally friendly society.” An entire section, as anticipated, dealt with ‘Defence’ and emphasized that the “most important” task for the armed forces “is to win a local war in the information age.”  Other areas of equal importance were identified as cyber and space.

Xi Jinping’s speech too was high in ideological content. It emphasized the need to “uphold and develop socialism with Chinese characteristics as the focus, priority…” and “make sure the 18th National Party Congress guidelines become a powerful ideological weapon.” He asserted that ‘the theoretical system of socialism with Chinese characteristics is the latest achievement in applying Marxism in China. In contemporary China, to uphold the theoretical system of socialism with Chinese characteristics is to truly uphold Marxism.” Xi Jinping clarified that the CCP will be the sole ruling party in China for a long time. Stating that the CCP’s task is to “make the Chinese people rich, build a strong, and prosperous country and rejuvenate the great Chinese nation,” Xi Jinping declared “our Party will always be a strong leadership core in the historical course of upholding and developing socialism with Chinese characteristics.” He also listed “combating corruption” and “preventing degeneration” as priority tasks. Earlier on November 16, speaking at an enlarged meeting of the Central Military Commission, Xi Jinping had similarly stressed the need to “take ideological and political building as the top priority in army building…and the Party has a firm grip over the troops ideologically, politically and organizationally.” He reiterated the importance of “the Party’s absolute leadership over the armed forces.”

Days after Xi Jinping took over as Chief of the Party and Military, the Party mouthpiece ‘People’s Daily’ front-paged a notice exhorting members to earnestly study and implement the spirit of the 18th Party Congress. Chinese observers in Beijing have also taken note of Xi Jinping’s stress on rooting out corruption, including in a rare and unusually candid speech made in 2002, where he mentioned the need to be frugal.  With the appointment of fellow princeling and newly-appointed PBSC member, Wang Qishan, as Chief of the Party’s watchdog body, Central Discipline Inspection Commission (CDIC), they anticipate that Xi Jinping might unleash an anti-corruption and rectification campaign in 2013, with the objective of restoring peoples’ confidence in the CCP and possibly removing unwanted adversaries. Also suggesting this possibility, Hong Kong’s South China Morning Post on November 26, pertinently added that Party ‘enforcer’ Wang Qishan’s skills would be put to the test as ‘…the state will collapse if the party does not tackle corruption, but the party will collapse if the anti-corruption push is too hard.’

China’s new leadership has made some forceful statements in their first few days in charge. Li Keqiang has announced a commitment to reforms and repeated that economic growth in 2012 would be 7.5 %. At the same time they are unlikely to make any major changes to the policies being followed for the past some years by Chinese President Hu Jintao and Premier Wen Jiabao. Domestic issues will be their priority, especially tackling issues like income inequality, corruption, pollution, etc. The restive ethnic minorities, especially the Tibetans, will also be a high priority but there is unlikely to be any genuine softening in policy.

There was minimal reference to foreign policy issues in Hu Jintao’s work report, where only Hong Kong and Taiwan were mentioned by name. Xi Jinping has not referred to it yet. On issues concerning sovereignty or maritime and land territorial claims, there will be no compromise and China’s neighbours, including India and Japan, should be prepared for increased pressure. China’s stance on its claims in the South China Sea will demonstrate its determination. For Beijing, the issue is not merely one of territory, but one that will help it regain its status as the pre-eminent power in the region. It will push the limits to attain its objective, but stop short of triggering conflict.

Jayadeva Ranade is a former Additional Secretary, Cabinet Secretariat, Government of India, and a security and intelligence expert. He is a seasoned China analyst, with over 25 years experience in the field.

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