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Thread: Politics: China Leadership Handover

  1. #1
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    Oct 2008

    Politics: China Leadership Handover

    China sets out its future

    14th Nov 2012
    By Wu Zhong, China Editor

    HONG KONG - Dull as the 18th National Congress of the Chinese Communist Party (CCP) may be, with its pre-fixed agenda, the party meeting that continues this week could still be said to be of epoch-making significance, both politically and economically.

    On the political side, the 18th party congress symbolizes that the CCP and China have eventually walked out of the shadow of Deng Xiaoping. It is well known that outgoing President Hu Jintao, like his predecessor Jiang Zemin, was handpicked and pre-appointed by Deng Xiaoping. As such, it could be said Hu has ruled China under Deng's shadow for years even though the paramount leader passed away several years before he came to power.

    Incoming Chinese leader Xi Jinping has no direct personal connection to Deng whatsoever and hence is not personally indebted to him. This may make it easier for him and CCP officials of his generation to review Deng's ideas and policies more objectively.

    From this point of view, it may not be coincidental that before the 18th party congress, criticism of Deng began to surface in China. For example, Deng's policy of allowing some people to "become rich first" is now blamed for causing and ever-growing wealth gap. There are also calls to abandon Deng's pragmatic trial-and-error approach toward reform and opening up ("Crossing the river by touching rocks on the riverbed").

    Some Chinese economists now argue that economic and financial reforms have already entered the "deep water zone" so it is no longer possible to touch any stepping stones. Therefore, economic reform and opening up must be reoriented; they require new theories and cannot be deepened without accompanying political and social reforms.

    Likewise, as tensions caused by territorial disputes in the East China Sea and South China Sea between China and Japan and some Southeast Asian countries intensify, Deng's diplomatic policy principles of tao guang yang hui" ("not to show off one's capability but to keep a low profile") and "shelving disputes and seeking joint development" are increasingly being questioned in China.

    The farewell to Deng also marks a formal goodbye to the "communist revolution". Both Mao Zedong and Deng were leaders of the Chinese revolution in the last century. Once Hu Jintao is gone, the CCP's direct link to Deng is also ended. In this sense, Xi's coming to power truly marks the beginning of the post-Deng Era. Xi's declaration that the CCP is no longer a party of revolution but has become the ruling party of China shows he wants to draw a demarcation line. [1]

    Xi is not handpicked by any single party heavyweight. He was chosen as a compromise of factional struggles. He does not need to remain loyal to any single person or single faction, making it easier for him to make changes, provided he wants to.

    Economically, the 18th party congress also marks the end of the era in which China has had to rely for its economic growth primarily on foreign investment and trade. From now on, China will have to boost domestic consumption as the major stimulus for economic growth.

    At the opening session of the congress, Hu delivered a keynote policy address - said to have been drafted by a group led by Xi Jinping. The report sets policy principles for the party and the government's works over the next five years.

    The address sets the goals of doubling both China's gross domestic product (GDP) and people's incomes by 2020 compared with 2010. This is the first time the CCP has explicitly set a long-term growth goal for people's incomes and is apparently aimed at easing public discontent over the fact that personal income growth has fallen behind economic growth in most of the past three decades. Putting such political consideration aside, an increase of people's incomes is a must if economic growth is to double the country's GDP by 2020.

    To achieve the GDP growth target, China must maintain an annual growth rate of about 7.5% over the next eight years. Given dramatic changes in the business environments both at home and abroad, it is impossible for China to rely on foreign trade to stimulate growth to the extent required by this 2020 target. Continued reliance for growth on a high rate of investment is equally problematic without an accumulation of an unsustainable debt burden. Hence, China will have to rely increasingly on domestic consumption to keep its economy growing.

    Growth of exports will remain sluggish. At a press conference on the sidelines of the congress, Minister of Commerce Chen Deming admitted export growth this year would be less than 10%. Chinese economists generally expect consumption's contribution to GDP will exceed 55%, becoming the leading horse of the "troika" pulling the Chinese economy.

    But to boost domestic consumption, people must have more money to spend. This explains, from an economic point of view, why the CCP for the first time sets a growth target for people's incomes. This is a direct and effective way to boost consumption.

    According to the National Bureau of Statistics, China's GDP totaled 39.8 trillion yuan (US$6.74 trillion) in 2010, up 10.3% from the previous year. Average per capita income for rural residents was 5,919 yuan, up 10.9% year on year; average per capita disposable income of urban residents was 19,109 yuan, up 7.8%.

    If the ambitious GDP growth goal the CCP sets can be attained, then by 2020 China's GDP is expected to reach nearly 80 trillion yuan while rural and urban residents' per capita incomes will be 12,000 yuan and 40,000 yuan respectively.

    China's population now is 1.35 billion, with about half being urban residents, as the so-called urbanization rate is expected to exceed 50% this year. Thus, disposable incomes of Chinese people totaled about 16.90 trillion yuan in 2010. Suppose the urbanization rate remains unchanged by 2020, though unlikely given the rapid moves to the cities, disposable incomes will already reach 33 trillion yuan, a sure signal of stronger consumption.

    Other measures unveiled in the party policy address, such as wealth redistribution reforms including, establishment of a universal social security network and improvement to the medical insurance system, are designed to help boost domestic consumption.

    The policy address stresses "achieving common prosperity" (instead of allowing some people to become rich first) so that "the fruits of development will be shared by the people". To do this, no effort will be spared to boost people's incomes by "deepening the [wealth] distribution system."

    It is thus expected that the long awaited reform of the distribution system is to start after the congress. Outlines of the reform were unveiled last month, based on the principles of "increasing the incomes of low-income people, curbing excessively high incomes and to outlaw illegal incomes, so as to expand the middle income population."

    The document sets a goal of building a universal social security network to cover the whole population and improving medical insurance system - another measure in favor of domestic consumption.

    By setting the goal to double people's incomes, the CCP leadership is well aware that this means labor cost will rise rapidly. Hence industries dependent on cheap labor will be gradually eliminated. Beijing is aware that the country can no longer rely on labor-intensive production and trade to sustain high-speed growth.

    But how to create new jobs when labor-intensive manufacturing industries are fading away becomes the principal new challenge. All this means a dramatic economic restructuring is under way.

    1. Xi to guide CCP from revolution to rule, Asia Times Online, October 17, 2012.

    (Copyright 2012 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)

  2. #2
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    Oct 2008
    The key concern is corruption.

    15th Nov 2012

    PLA reshuffle draws battle lines

    By Willy Lam

    The Beijing leadership has reshuffled the high command of the People's Liberation Army (PLA) as the military goes through its own leadership transition separate from but linked to the 18th Party Congress. The move has also given hints about the reorganization of the policy-setting Central Military Commission (CMC). The membership of a much rejuvenated CMC will be confirmed by the 18th Chinese Communist Party (CCP) Congress.

    Although this round of personnel selection reinforces the PLA's increasing dedication to professionalism in its upper echelons, this series of personnel changes also reflects intense horse-trading among the party's principal factions.

    The new chiefs of the "Four General Departments" - the General Staff Department (GSD), General Political Department (GPD), General Logistics Department (GLD) and General Armaments Department (GAD) - are respectively General Fang Fenghui (aged 61); General Zhang Yang (61); General Zhao Keshi (65); and General Zhang Youxia (62). Moreover, General Ma Xiaotian, (aged 63) and General Wei Fenghe (5 have been appointed commander of respectively the Air Force and the Second Artillery (which is in charge of the country's nuclear armory).

    The incumbent Commander of the Navy, Wu Shengli (67) is expected to remain in his post for the foreseeable future. Also named were a dozen-odd new deputy and assistant chiefs of the headquarters units as well as the Navy, Air Force and Second Artillery.

    The chiefs of the four general departments as well as the three military divisions will become ordinary members of the CMC. Uncertainties, however, still hang over the identities of the top CMC leadership. According to reports out of Beijing and Hong Kong, President Hu (aged 69) will stay on as CMC chairman for at least two years beyond his retirement from the Politburo and the Central Committee at the 18th CCP Congress. The precedent for this in the post-revolutionary generation was set by ex-president Jiang Zemin, who continued being CMC chair for almost two years after his retirement from all other party slots at the 16th Party Congress in 2002. This means that Vice President Xi Jinping (59), who is slated to soon replace Hu as CCP general secretary, will remain CMC vice chairman for the time being.

    The two new CMC vice chairmen are former PLA Air Force Commander General Xu Qiliang (62) and Commander of the Jinan Military Region General Fan Changlong (who is aged 65). The newly retired GAD Director, General Chang Wanquan (age 63) is set to replace General Liang Guanglie as Defense Minister.

    The just-named Chief of the General Staff General Fang perhaps best exemplifies the new generation of professionally savvy officers. Fang, a native of Shaanxi Province and graduate of the elite National Defense University, was the youngest of China's seven regional commanders when he was given the No. 1 post of the Beijing Military Region (MR) in 2007. Apart from his command-and-control skills, Fang is a much-published author on military strategy, particularly in the areas of computer-aided war games and the synchronization of different branches of the military forces.

    One of General Fang's favorite mottoes is that "radically changing times demand innovation in strategic theories". President Hu was said to be very impressed with Fang's orchestration of the 2009 military parade in Bejing, which marked the 60th anniversary of the founding of the People's Republic. Last year, Fang won plaudits when he supervised complicated-scale maneuvers involving more than 30,000 soldiers from the Beijing, Lanzhou and Chengdu MRs. While the great majority of his predecessors as Beijing MR commander went into retirement after serving in this sensitive position, General Fang seems to have a bright future ahead of him.

    Two hot contenders for the post of GPD director lost out apparently due to their close association with the disgraced Politburo member and Chongqing Party Secretary Bo Xilai. They are the Political Commissar of the General Logistics Department General Liu Yuan (aged 61) and the Political Commissar of the Second Artillery General Zhang Haiyang (63).

    Like Bo, who is the son of revolutionary hero Bo Yibo, Generals Liu and Zhang are deemed high-profile princelings. General Liu is the son of the late state president Liu Shaoqi, while General Zhang is the son of former Politburo member General Zhang Zhen. While Bo has never served in the PLA, he has a large following amongst the "princeling generals". The charismatic former Politburo member is due to be put on trial for alleged crimes including large-scale corruption and dereliction of duty.

    After Bo was detained by authorities in mid-March, PLA disciplinary authorities have run numerous campaigns to promote the ideal of "the party's absolute leadership over the army". An August 1 Army Day commentary in the PLA Daily made an unusual reference to the army's immunity against being manipulated by "ambitious careerists" in the mould of Bo.

    "In the midst of even the most dangerous situations, not a single troop in our army's history has mutineered or surrendered to the enemy," said the Daily commentary, "And not even the most cunning and ambitious careerist has been able to use the army to realize his conspiracy". In a talk last month, then-CMC vice chairman Xu Caihou urged officers and soldiers to "ensure that the troops must uphold a high level of unison with the central party leadership and the CMC in the areas of thought and politics." Xu added "We must resolutely listen to the directions of the party central leadership, the CMC and Chairman Hu".

    In terms of factional dynamics, President Hu seems to be a major beneficiary of the reshuffle. Apart from Chief of the General Staff General Fang, GPD Director General Zhang is said to be close to the supremo. Given that the GPD controls functions including appointments and discipline, Hu may through his close ties with General Zhang be able to maintain some say in personnel matters even after his departure from the CMC.

    Hu's clout also is evidenced by the surprise appointment of another protege, the relatively inexperienced Hong Kong Garrison commander Zhang Shibo, as General Fang's successor as Beijing MR commander. Before assuming the Hong Kong posting in late 2007, Zhang, a 60-year-old lieutenant general, was commander of the 20th Group Army.

    Other appointments may reflect the preferences of ex-president Jiang and Vice President Xi. The probable promotion of Jinan MR Commander General Fan to the CMC vice chairmanship reflects Jiang's residual influence. General Fan is the protege of soon-to-retire CMC Vice Chairman General Xu, who is deemed Jiang's "unofficial representative" in the CMC. Both Generals Xu and Fan had served for long periods in the 16th Group Army. Earlier this year, General Fan (65) was expected to be leaving the armed forces after having reached the mandatory retirement age for regional commanders.

    Xi's influence in the PLA has been adversely affected by the fact that the career of several princeling generals has been hurt by their association with Bo Xilai. New Air Force commander General Ma Xiaotian and GAD Director General Zhang Youxia, however, are notable princelings. General Zhang is thought to be particularly close to Xi. The fathers of Xi and General Zhang, respectively Xi Zhongxun and General Zhang Zongxun, were close allies when both worked in northwestern China before the CCP came into power in 1949.

    The marathon reshuffles also have followed the tradition begun by President Hu of the frequent movement of personnel not only across different military divisions but also from headquarters to the regions. For example, the Political Commissar of the Chengdu MR, General Tian Xiusi, was made the Political Commissar of the Air Force. Assistant GPD Director General Wei Liangzhong became the Political Commissar of the Guangzhou MR, while General Wang Guanzhong, the veteran Director of the PLA General Office, was appointed a Deputy Chief of the GSD.

    Also notable are the proverbial "helicopter rides" taken by the likes of General Fan of the Jinan MR and General Zhang of the Hong Kong Garrison. It is very rare for a regional commander to be elevated directly to CMC vice chairman. General Zhang's promotion to the post of Beijing MR Commander is also unusual. In light of the importance of the Beijing MR, only officers who had held senior posts such as deputy commander or chief of the general staff of the country's seven MRs had been named to that sensitive slot.

    Given that factional loyalty is a key consideration behind the on-going personnel movements, it is perhaps not surprising that not as much priority has been given to weeding out corruption in the military. This is despite the fact that General Liu Yuan - one of the high-profile losers in the promotion sweepstakes - was praised highly for initiating an anti-graft campaign within the GLD early this year.

    Senior Colonel Liu Mingfu, a professor at the National Defense University and a respected military commentator, pointed out recently that "corrupt generals" were an even more serious problem than "corrupt cadres". Last month, Liu said "Corruption is the only force that can defeat the PLA."

    "Yet the forces of corruption are more powerful than those of fighting corruption," he added. "And perpetrators of corruption are more resourceful than graft busters". The onus is on the post-18th Party Congress leadership to demonstrate that members of the newly promoted top brass live up to the oft-repeated motto ofdecai jianbei, that is, "having high moral attributes as well as being professionally competent".

    Dr Willy Wo-Lap Lam is a Senior Fellow at The Jamestown Foundation. He has worked in senior editorial positions in international media including Asiaweek newsmagazine, South China Morning Post, and the Asia-Pacific Headquarters of CNN. He is the author of five books on China, including the recently published Chinese Politics in the Hu Jintao Era: New Leaders, New Challenges. Lam is an Adjunct Professor of China studies at Akita International University, Japan, and at the Chinese University of Hong Kong.

    (This article first appeared in The Jamestown Foundation. Used with permission.)

    (Copyright 2012 The Jamestown Foundation.)

  3. #3
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    Oct 2008
    16th Nov 2012

    Hu hands China's military baton to Xi

    By Wu Zhong, China Editor

    HONG KONG - The Chinese Communist Party, undergoing a once-in-a-decade change of its top leadership, confirmed on Thursday that Xi Jinping will take over the top party role as general secretary but surprised by announcing that Xi will take over from President Hu Jintao as head of the Central Military Commission (CMC). The appointment of Wang Qishan as top anti-graft official also indicates the new government's sense of priorities.

    Xi was officially elected along with other appointments to the core Politburo Standing Committee (PSC) by the Central Committee of the Chinese Communist Party, whose own new membership was selected yesterday by the party's 18th National Congress. The PSC was reduced in membership to seven from nine.

    Xi, 59, will take over the state presidency from Hu at the National People's Congress (NPC) next March, when he will formally become the country's supreme leader. The other new leaders will also take up their government posts at that time.

    The appointment of Xi as head of the CMC means outgoing President Hu has agreed to go into full retirement rather than follow the path of his predecessor, Jiang Zemin, who stayed on as CMC chairman for couple of years after giving up his party and state posts. After Hu passes his state presidency to Xi at the NPC in March, he will hold no official position.

    It is speculated in Beijing that Hu has become tired by the intervention in party and state affairs of retired party elders and wants to use his own full retirement to put an end to such practices in China's political life. Accordingly, approving his request for full retirement, the party has also made a resolution to ban retired leaders from meddling in party and state affairs. If this is the case, then it is truly a mark of progress in Chinese politics.

    Other PSC members, with their new posts to be confirmed by the NPC in March, are:
    Li Keqiang (57) at present vice premier, to succeed Wen Jiabao as prime minister.
    Zhang Dejiang (66) at present vice premier and Chongqing party chief, to succeed Wu Bangguo as NPC chairman.
    Yu Zhengsheng (67) at present Shanghai party chief, to succeed Jia Qingling as chairman of the Chinese People's Political Consultative Conference (CPPCC).
    Liu Yunshan (65), at present party propaganda chief, to oversee party operations and propaganda affairs.
    Wang Qishan (64), at present vice premier, is appointed as head of the CCP's Central Commission for Disciplinary Inspection (CCDI), the party's top anti-graft watchdog.
    Zhang Gaoli (66), at present Tianjin party chief, to be executive vice premier.

    Wang Qishan's appointment as CCDI chief was not entirely expected. It had been speculated that he would take the CPPCC chairmanship or executive vice premiership.

    But this is a wise choice. Wang is known for his ability to deal with crises. A protege of former premier Zhu Rongji, he was regularly sent to wherever these occurred. As such he is known as the party's "chief fire-fighter". Appointing him to head the CCDI is evidence that Xi takes seriously the uphill battle the party faces against corruption. A shrewd, no-nonsense Wang leading the anti-graft watchdog serves as a major deterrent to corrupt officials. Given his past record, he surely will not let big fish slip away easily.

    This said, however, one individual's role should not be exaggerated. Zhu Rongji once expressed his determination to curb official corruption by saying: "I'll have 100 coffins prepared. Ninety-nine are for corrupt officials and the last one is for myself."

    But corruption was not effectively contained during his tenure (an excuse for Zhu could be that he mainly oversaw economic and financial affairs). The root of corruption lies in the Chinese system. Whether Wang can or will design a reform of the system to set up an effective anti-graft mechanism remains to be seen.

    The appointment may also be a good move for Wang himself, as he is a man of action rather than talk. The CPPCC is a venue to liaise with non-communist parties and people with leading roles in society and is thus more like a house for talk shows. Although the CPPCC chairmanship is a higher-profile post than the one Wang is taking, the CCDI has more real power. For one thing, a CCDI clearance is a must for the promotion of a senior official.

    At the same time, given Wang's expertise in economics and finance, his skills would also be valuable as the executive vice premier overseeing economic and financial affairs. The consideration behind this is perhaps a reflection also of the desire for better teamwork among the new leadership. If Wang were to take the first vice premiership, Li Keqiang would inevitably become a very weak premier. This would not be good for Li in his second term five years on, when Wang will have to retire.

    In any case, Wang will still retain influence on economic affairs, especially financial matters. Leading financial officials such as heads of the securities, insurance and banking regulators are all his proteges.

    The new PSC members represent various factions. Xi Jinping and Wang Qishan are princelings; Li Keqiang belongs to Hu's Communist Youth League faction; Yu Zhengsheng is a princeling and is considered a protege of Jiang Zemin; Liu Yunshan and Zhang Gaoli are also Jiang's proteges. Hence, Jiang's Shanghai faction seems to have gained an upper hand in the reshuffle.

    In face of arduous tasks ahead, however, they are all in the same boat and will have to work together and compromise when differences emerge among them.

    A feature of the new PSC is that its members are better educated than their predecessors. Both Xi and Li hold PhDs (Xi's in law from Tsinghua University and Li's in economics from Peking University). This is unprecedented.

    They are also younger, all being born in the late 1940s or early 1950s. As such, they all grew up in the era of Mao Zedong. Having suffered starvation during the Great Leap Forward, experienced the Cultural Revolution and worked at the grassroots level, they know which path is better for China and will support reform and opening up. In this sense, they all could be said to be reform-minded, though this does not necessarily mean that they will be in agreement on all reform policies and measures.

    All except Liu Yunshan have experience in running a province and know the difficulties of local government; they are also aware of the tricks that can be played by local officials, and will not be easily fooled.

    Qualitative goals
    It is a good sign for them that Hu will not be staying on as CMC chairman. If Hu in retirement indeed keeps his hands off party and state affairs, Xi and his team may be able to bring their own potential into full play. Even older-generation party elders like Jiang Zemin still want to meddle, but they will soon lose their steam given their age.

    The 18th party congress sets two targets - of doubling both gross domestic product (GDP) and people's incomes by 2020 compared with 2010. These are quantitative goals. To achieve them, the new team must ensure an annual growth of at least 7.5% for both GDP and incomes in the next eight years. If they fail to do so, people will become discontented with them.

    And they come to power at a bad time. While the Chinese economy may be bottoming out, the driving force for growth remains rather weak. Therefore, from day 1 in office, Xi and his team will have to wrack their brains on how to stimulate economic growth.

    They have also to clean the mess left by the Hu-Wen leadership.

    As the CCP accomplished its power transition with its 18th National Congress, the People's Daily, the party's flagship newspaper, published an article on its website to summarize the contributions of previous party leaders.

    "Chairman Mao led Chinese people to stand up, Deng Xiaoping led Chinese people to become rich, Jiang Zemin led Chinese people to grow stronger, and Hu Jintao led the Chinese people to take off (to the sky)," it said, quoting an elderly chicken farmer. It immediately causes a great uproar among Chinese netizens particularly with the praise of Hu.

    The Chinese economy has certainly taken off in past decade under the Hu-Wen leadership. But the country has paid a heavy price for the economic growth miracle - the wealth gap has widened, corruption is rife, problems of food and drug safety abound, eco-environmental disasters are numerous ... so much so that various surveys show that Chinese people nowadays feel less happy than before.

    Xi and his team will have to tackle these problems, none of which is easy to resolve. They will have to fight an uphill battle on every front.

    (Copyright 2012 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)

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