Deng Xiaoping | CHINDIA ALERT: You'll be living in their world, very soon

20/09/2014

The rise and rise of Xi Jinping: Xi who must be obeyed | The Economist

THE madness unleashed by the rule of a charismatic despot, Mao Zedong, left China so traumatised that the late chairman’s successors vowed never to let a single person hold such sway again. Deng Xiaoping, who rose to power in the late 1970s, extolled the notion of “collective leadership”. Responsibilities would be shared out among leaders by the Communist Party’s general secretary; big decisions would be made by consensus. This has sometimes been ignored: Deng himself acted the despot in times of crisis. But the collective approach helped restore stability to China after Mao’s turbulent dictatorship.

Xi Jinping, China’s current leader, is now dismantling it. He has become the most powerful Chinese ruler certainly since Deng, and possibly since Mao. Whether this is good or bad for China depends on how Mr Xi uses his power. Mao pushed China to the brink of social and economic collapse, and Deng steered it on the right economic path but squandered a chance to reform it politically. If Mr Xi used his power to reform the way power works in China, he could do his country great good. So far, the signs are mixed.

It may well be that the decision to promote Mr Xi as a single personality at the expense of the group was itself a collective one. Some in China have been hankering for a strongman; a politician who would stamp out corruption, reverse growing inequalities and make the country stand tall abroad (a task Mr Xi has been taking up with relish—see article). So have many foreign businessfolk, who want a leader who would smash the monopolies of a bloated state sector and end years of dithering over economic reforms.

However the decision came about, Mr Xi has grabbed it and run with it. He has taken charge of secretive committees responsible for reforming government, overhauling the armed forces, finance and cyber-security. His campaign against corruption is the most sweeping in decades. It has snared the former second-in-command of the People’s Liberation Army and targeted the retired chief of China’s massive security apparatus—the highest-ranking official to be investigated for corruption since Mao came to power. The generals, wisely, bow to him: earlier this year state newspapers published pages of expressions of loyalty to him by military commanders.

He is the first leader to employ a big team to build his public profile. But he also has a flair for it—thanks to his stature (in a height-obsessed country he would tower over all his predecessors except Mao), his toughness and his common touch. One moment he is dumpling-eating with the masses, the next riding in a minibus instead of the presidential limousine. He is now more popular than any leader since Mao (see article).

All of this helps Mr Xi in his twofold mission. His first aim is to keep the economy growing fast enough to stave off unrest, while weaning it off an over-dependence on investment in property and infrastructure that threatens to mire it in debt. Mr Xi made a promising start last November, when he declared that market forces would play a decisive role (not even Deng had the courage to say that). There have since been encouraging moves, such as giving private companies bigger stakes in sectors that were once the exclusive preserve of state-owned enterprises, and selling shares in firms owned by local governments to private investors. Mr Xi has also started to overhaul the household-registration system, a legacy of the Mao era that makes it difficult for migrants from the countryside to settle permanently in cities. He has relaxed the one-child-per-couple policy, a Deng-era legacy that has led to widespread abuses.

via The rise and rise of Xi Jinping: Xi who must be obeyed | The Economist.

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Tags: China, communist party of china, Deng, Deng Xiaoping, dengxiaoping, Mao, Mao Zedong, maozedong, People's Liberation Army, Xi JinPing

23/05/2014

China Moves to Protect Its Language From English – Businessweek

Will the Chinese anti-English (American) language campaign be any more successful than the French one? I wonder.

See – http://www.thedailybeast.com/articles/2013/05/30/france-s-pointless-hopeless-battle-against-english.html

“Chinese authorities are waging a war on American culture and the use of English. In April, China’s media regulators yanked the popular U.S. television shows The Big Bang Theory, NCIS, and The Good Wife from Chinese streaming websites Sohu (SOHU) and Youku (YOKU). The official party newspaper, People’s Daily, ran two editorials in April bemoaning the use of words borrowed from English when speaking Chinese. Then in mid-May came a flurry of reports in the state media confirming plans announced last fall to reduce the importance of English-language instruction and to expand courses on traditional culture in grade school and high school.

The government “wants to make us respect the Chinese language and culture more,” says Guo Jintong, a 16-year-old Beijing high school student, as he sits in a Starbucks drinking a grande cappuccino. “With everyone wanting to go overseas to study, there is a craze for English and the West that you can say has become excessive. This could have a bad effect on China.” Guo says he plans to go to the U.S. for graduate school after getting his bachelor’s in physics in China.

China’s obsession with English dates to the establishment of foreign-language schools and translation centers—mainly for English—along China’s coast after the Opium Wars of the mid-19th century, says Yang Rui, director of the Comparative Education Research Center at the University of Hong Kong. And while Russian was the official second language during the 1950s, English again took primacy when Deng Xiaoping launched economic reforms in 1978 and China was eager for technology and investment from the West. (Yang learned English by secretly listening to banned Voice of America broadcasts during the Cultural Revolution, when speaking a foreign tongue could land you in jail.)”

via China Moves to Protect Its Language From English – Businessweek.

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Tags: American culture, Big Bang Theory, China, China Moves, chinese authorities, Comparative Education Research Center, Deng Xiaoping, English language, Guo Jintong, language campaign, Opium Wars, SOHU, starbucks, Yang Rui

21/03/2014

China Wants Its People in the Cities – Reuters

From: http://www.businessweek.com/articles/2014-03-20/china-wants-its-people-in-the-cities

Thirty-five years ago, when paramount leader Deng Xiaoping launched gaige kaifang, or “reform and opening,” China was a much more agricultural country, with less than a fifth of its people living in cities. Since then hundreds of millions of rural residents have left the countryside, many seeking jobs in the export-oriented factories and construction sites that Deng’s policy promoted.

Commercial and residential buildings stand in the Luohu district of Shenzhen, China, on Dec. 18, 2013 In 1978 there were no Chinese cities with more than 10 million people and only two with 5 million to 10 million; by 2010, six cities had more than 10 million and 10 had from 5 million to 10 million. By the following year, a majority of Chinese were living in urban areas for the first time in the country’s history.

Now urbanization has been designated a national priority and is expected to occur even more rapidly. On March 16, Premier Li Keqiang’s State Council and the central committee of the Communist Party released the “National New-type Urbanization Plan (2014-2020),” which sets clear targets: By 2020 the country will have 60 percent of its people living in cities, up from 53.7 percent now.

What’s the ultimate aim of creating a much more urban country? Simply put, all those new, more free-spending urbanites are expected to help drive a more vibrant economy, helping wean China off its present reliance on unsustainable investment-heavy growth. “Domestic demand is the fundamental impetus for China’s development, and the greatest potential for expanding domestic demand lies in urbanization,” the plan says.

To get there, China’s policymakers know they have to loosen the restrictive hukou, the household registration policy that today keeps many Chinese migrants second-class urban residents. China will ensure that the proportion of those who live in the cities with full urban hukou, which provides better access to education, health care, and pensions, will rise from last year’s level of 35.7 percent of city dwellers to 45 percent by 2020. That means 100 million rural migrant workers, out of a total 270 million today, will have to be given urban household registration.

To prepare for the new masses, China knows it must vastly expand urban infrastructure. The plan calls for ensuring that expressways and railways link all cities with more than 200,000 people by 2020; high-speed rail is expected to link cities with more than a half million by then. Civil aviation will expand to be available to 90 percent of the population.

Access to affordable housing projects funded by the government is also expected to rise substantially. The target is to provide social housing (roughly analogous to public housing in the U.S.) to 23 percent of the urban populace by 2020; that’s up from an estimated 14.3 percent last year, according to Tao Wang, China economist at UBS Securities (UBS) in Hong Kong. That means providing social housing for an additional 90 million people, amounting to about 30 million units, over the next seven years, Wang writes in a March 18 report.

The urbanization plan appears to face several big challenges. First, the government wants to maintain restrictions on migration to China’s biggest cities, which also happen to be its most popular. Instead, the plan calls for liberalizing migration to small and midsize cities, or those with less than 5 million. Whether migrants will willingly flock to designated smaller cities, rather than the megacities including Beijing, Shanghai, Guangzhou, and Shenzhen, is an unanswered question.

…

Another obstacle to faster urbanization is that the plan doesn’t propose how to reform China’s decades-old land tenure system. Changing the system could allow farmers more freedom to mortgage, rent, or sell their land.

Finally, one of the most daunting problems is figuring out how to pay for implementing the ambitious urbanization targets. The cost of rolling out a much more extensive social welfare network will be substantial (today, most Chinese in the countryside have far lower levels of medical and pension coverage, as well as far inferior schools); building the new urban infrastructure will also be expensive.

…

Posted in Affluence, China alert, Consumer, Economics, Household registration, Housing, housing, land transfer, Migrant workers, Reform, urban development | Leave a Comment »

Tags: Beijing, China, Deng Xiaoping, Hong Kong, Li Keqiang, List of cities in the People's Republic of China, UBS, Urbanization

06/02/2014

Why China’s Leaders Are Finding It Harder to Govern | Foreign Affairs

China had three revolutions in the twentieth century. The first was the 1911 collapse of the Qing dynasty, and with it, the country’s traditional system of governance. After a protracted period of strife came the second revolution, in 1949, when Mao Zedong and his Communist Party won the Chinese Civil War and inaugurated the People’s Republic of China; Mao’s violent and erratic exercise of power ended only with his death, in 1976.

Laborers clean a statue of Mao, September 24, 2013.

The third revolution is ongoing, and so far, its results have been much more positive. It began in mid-1977 with the ascension of Deng Xiaoping, who kicked off a decades-long era of unprecedented reform that transformed China’s hived-off economy into a global pacesetter, lifting hundreds of millions of Chinese out of poverty and unleashing a massive migration to cities. This revolution has continued through the tenures of Deng’s successors, Jiang Zemin, Hu Jintao, and Xi Jinping.

Of course, the revolution that began with Deng has not been revolutionary in one important sense: the Chinese Communist Party (CCP) has maintained its monopoly on political power. Yet the cliché that China has experienced economic reform but not political reform in the years since 1977 obscures an important truth: that political reform, as one Chinese politician told me confidentially in 2002, has “taken place quietly and out of view.”

The fact is that China’s central government operates today in an environment fundamentally different, in three key ways, from the one that existed at the beginning of Deng’s tenure. First, individual Chinese leaders have become progressively weaker in relation to both one another and the rest of society. Second, Chinese society, as well as the economy and the bureaucracy, has fractured, multiplying the number of constituencies China’s leaders must respond to, or at least manage. Third, China’s leadership must now confront a population with more resources, in terms of money, talent, and information, than ever before.

Governing China has become even more difficult than it was for Deng Xiaoping.

For all these reasons, governing China has become even more difficult than it was for Deng. Beijing has reacted to these shifts by incorporating public opinion into its policymaking, while still keeping the basic political structures in place. Chinese leaders are mistaken, however, if they think that they can maintain political and social stability indefinitely without dramatically reforming the country’s system of governance. A China characterized by a weaker state and a stronger civil society requires a considerably different political structure. It demands a far stronger commitment to the rule of law, with more reliable mechanisms — such as courts and legislatures — for resolving conflicts, accommodating various interests, and distributing resources. It also needs better government regulation, transparency, and accountability. Absent such developments, China will be in for more political turmoil in the future than it has experienced in the last four-plus decades. The aftershocks would no doubt be felt by China’s neighbors and the wider world, given China’s growing global reach. China’s past reforms have created new circumstances to which its leaders must quickly adapt. Reform is like riding a bicycle: either you keep moving forward or you fall off.

via Why China’s Leaders Are Finding It Harder to Govern | Foreign Affairs.

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Tags: China, China's Communist Party, Chinese Civil War, Deng Xiaoping, Hu Jintao, Jiang Zemin, Mao Zedong, Xi JinPing

21/12/2013

Chinese Leader Xi Weakens Role of Beijing’s No. 2 – WSJ.com

We did notice at the time and commented on PM Cameron being hosted by President Xi. See – https://chindia-alert.org/2013/12/03/the-banquet-that-wasnt-and-then-a-gift-horse-the-times/

“British officials were finalizing details of Prime Minister David Cameron\’s visit this month to Beijing when they received a last-minute scheduling change: President Xi Jinping would host a banquet in Mr. Cameron\’s honor.

The invitation, which delighted the British officials, effectively scrubbed dinner plans with Mr. Cameron\’s official host, Premier Li Keqiang. And it illustrates an important shift in the Chinese leadership\’s internal dynamics: Mr. Xi is downgrading the premier\’s role and assuming the primary duty of overseeing economic reforms as well as briefing foreign leaders on economic affairs, Communist Party insiders say.

In the frantic diplomatic exchanges over the scheduling dilemma, Premier Li\’s dinner was first postponed, then turned into a lunch, and Mr. Cameron had to cancel a visit to the city of Hangzhou. Previous protocol dictated only a brief meeting with the Chinese president as Mr. Cameron isn\’t head of state.

There is no evidence of discord between Messrs. Xi and Li, the party insiders say. But Mr. Xi is subverting a nearly two-decade-old division of power whereby the president, who is also party chief, handles politics, diplomacy and security, while the premier manages the economy.

Having rapidly established his authority over the party and the military in his first year in power, Mr. Xi is now stepping in on the economy, making him the most individually powerful leader since Deng Xiaoping, the man who launched China\’s economic liberalization in 1978. \”The really big change is that Xi is saying, \’I\’m the boss, and that extends to everything,\’ \” says Barry Naughton, an expert on the Chinese economy at the University of California, San Diego.

Some party insiders welcome the concentration of power in Mr. Xi\’s hands as a way to combat the bureaucratic inertia that some say bogged down reforms under the previous leadership. Others, however, fear that it could lead to impulsive, or misinformed, decision-making. One possible example was China\’s sudden announcement last month of a new air-defense identification zone over the East China Sea without consulting neighboring countries, analysts and diplomats say.

Mr. Xi\’s predecessor, Hu Jintao, played a negligible role in the economy and shared power evenly with Wen Jiabao, the last premier, who was in charge of the massive stimulus plan to respond to the 2008-09 global financial crisis. Before them, President Jiang Zemin left the economy to Premier Zhu Rongji, who pushed through wrenching state-sector reforms and secured China\’s entry to the World Trade Organization.

By contrast, Mr. Xi is depicted as playing a central role in the ambitious economic-reform package approved by the 376-member Central Committee last month. State media published a lengthy official account saying Mr. Xi had personally led the drafting of the plan—the first time a party chief had done so since 2000. The account mentioned Mr. Xi\’s name 34 times. Mr. Li wasn\’t mentioned once.

Drafting of a similar economic plan, unveiled in 2003, was overseen by Premier Wen.

The latest plan calls for a new party body to oversee the reforms. While the group\’s composition hasn\’t yet been chosen, members are likely to report to Mr. Xi, according to several party officials. That will help the president bypass the State Council, or cabinet, which is headed by the premier, party insiders say, and has been a choke point for reform because its many ministries represent different interest groups.”

via Chinese Leader Xi Weakens Role of Beijing’s No. 2 – WSJ.com.

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Tags: Beijing, China, communist party of china, David Cameron, Deng Xiaoping, Hu Jintao, Wen Jiabao, Xi JinPing

09/12/2013

Mao Zedong: Merry Mao-mas! | The Economist

THE village of Shaoshan in the green hills of Hunan province in east-central China is gearing up for a big party on December 26th: the 120th birthday of its most famous son, Mao Zedong. Debate rages in China over Mao’s historical role. Some call him a tyrant for the violence he put at the heart of his rule, causing the deaths of tens of millions of people. Others worship him almost as a god. In Shaoshan he is a money-spinner, with the farmhouse where he was born attracting millions of Chinese tourists every year.

For President Xi Jinping evaluating Mao’s legacy is especially tricky. On the anniversary he must tread a careful line. Since he took over as Communist Party chief a year ago Mr Xi has shown a fondness for Maoist rhetoric. He calls, for instance, for a “mass line” campaign to restore the party’s traditional values and a “rectification” movement to purge it of corruption. Mr Xi’s willingness to show off his grip on power suggests a leadership style more evocative of the Mao era than of the grey consensus of recent years. Earlier this year he is reported to have told Vladimir Putin, the Russian president, that “you and I have very similar characters”.

Maoism

Yet in ideological terms, Mr Xi is no Maoist. This month’s anniversary is probably a headache he could do without. In November, at a landmark plenum, the party’s central committee adopted a resolution which, in economic terms, aims to shift China even further from Maoism than the late reformer, Deng Xiaoping, attempted. Market forces, it ruled, would henceforth play a “decisive role” in the economy.

Still, Mao continues to exert a powerful influence over the party and public opinion. Mr Xi dares not play down Mao’s “contributions” for fear that outright de-Maoification could fatally weaken the party’s grip. A recent article in the party’s mouthpiece, the People’s Daily, said that a big reason for the collapse of the Soviet Union—an unadulterated tragedy, it was naturally understood—was the “negation of Lenin and other [historical] leaders”. As Communist China’s founder as well as the leader most noted for brutal excess, Mao is Lenin and Stalin rolled into one.

At December’s birthday celebrations, some sense an opportunity. At one end of the political spectrum are liberals who want Mr Xi and China’s new generation of leaders to repudiate Mao as a prelude to far-reaching political reform. At the other end are diehard or born-again Maoists who revere the late chairman as an embodiment of anti-Western nationalism. They want Mao to be, in effect, sanctified, with December 26th declared a national holiday. In recent months, both ends of the spectrum have been trying to push their cases. They will be paying close attention to what Mr Xi has to say.

via Mao Zedong: Merry Mao-mas! | The Economist.

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Tags: China, Deng Xiaoping, Hunan, Mao, Mao Zedong, Maoism, Shaoshan, Xi JinPing

23/11/2013

Reform in China: Let quite a few flowers bloom | The Economist

THE jury is in. After months of speculation and an initial summary last week, the final 22,000-character overview of China’s “third plenum” was published on November 15th. In the economic sphere the document turned out to be bolder than the initial summary suggested. The new party boss, Xi Jinping, wants to push through changes that have stalled over the past decade. As the document itself says: “We should let labour, knowledge, technology, management and capital unleash their dynamism, let all sources of wealth spread and let all people enjoy more fruits of development fairly.” Quite.

It is by no means certain that Mr Xi will be able to do all he wants to (see article), but it is clear he has won the battle so far. Economically, he is proving himself an heir to Deng Xiaoping, China’s great reformer, and not the closet Maoist that some had feared. Conservative forces seeking to stifle reformist voices have been quieted, at least for the time being.

The document’s interest lies not just in the economic reforms, which were anticipated. More striking were some of the social changes the document announced, such as the relaxation of the one-child policy. A couple in which one parent is an only child will be allowed to have two children, and the policy is likely to be loosened even further. In another widely welcomed move, labour camps—in which around 190,000 people, including political and religious activists, are detained—are to be abolished.

But possibly the most important announcements were buried deep in the document and grabbed fewer headlines. Two moves in particular showed that the party is sensitive to the ferment in Chinese society and the demands for greater liberty and accountability that accompany it.

In the past 30 years China has gone from a totalitarian society to one in which people can usually work where they want, marry whom they want, travel where they want (albeit with varying degrees of hassle for those from the countryside and ethnic-minority regions). In ten years internet penetration has gone from minimal to almost universal. Old welfare structures have broken down, with little to take their place. Ordinary people are being empowered by new wealth and participation, through microblogs, and by becoming consumers and property owners. Change is bubbling up from the bottom and the system cannot contain it.

An uNGOvernable state

Society is becoming too complex for the old structures to handle. Hence the government’s decision to allow the development of what it calls “social organisations”. In essence these are NGOs. The party dislikes the idea of anything non-governmental and has long regarded NGOs as a Trojan horse for Western political ideas and subversion, but it is coming to realise that they could solve some of its problems—caring for the sick, elderly and poor, for instance. The growth of civil society is not just important in itself. It is also the bridge to the future, linking today’s economic reforms to whatever putative future political reform might come.

Equally important is the issue of judicial reform. China’s hopelessly corrupt judges are unpopular. The party resolution floats the idea of “judicial jurisdiction systems that are suitably separated from administrative areas”; that is, local judiciaries that are not controlled and paid for by local officials. Though some observers doubt this will happen, if it does it could be the start of a system of basic checks and balances, which would make officials more accountable.

That these two gestures towards reform were mentioned at all is encouraging; that they were barely visible to the untrained eye shows the party’s ambivalence towards liberalisation. But it must push ahead. Its planned economic reforms will surely generate not just wealth, but more pressure for political change. Unless the party responds, there could be an explosion. If Mr Xi is inclined to wobble, he should remember the advice in the plenary document: “Dare to gnaw through even tough bones, dare to ford dangerous rapids, break through the fetters of ideological concepts with even greater resolution.”

via Reform in China: Let quite a few flowers bloom | The Economist.

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Tags: China, communist party of china, Deng Xiaoping, Maoism, Non-governmental organization, Party leader, Social change, Xi JinPing

21/11/2013

As Xi Jinping Reforms China, Expect Power Consolidation, Not Democracy – Businessweek

Chinese President Xi Jinping is all about reform. That’s “reform” as in “kicking butt.” The main take-away from the Third Plenary Session of the Communist Party’s 18th Central Committee is that Xi has consolidated power remarkably quickly and is eager to use it. Some parts of his agenda impress outsiders, such as further relaxing the one-child policy and closing reeducation labor camps. Such steps defuse popular anger toward the regime. Other Xi initiatives are decidedly less appealing, like the vow to “utilize and standardize Internet supervision,” which is code language for censorship. But whether liked or disliked outside China, everything Xi intends to do is directed toward one goal: to consolidate the Communist Party’s central and permanent role as the leader of the nation.

As Xi Jinping Reforms China, Expect Power Consolidation, Not Democracy

Democracy is the yielding of power from the party to the people. That’s not what Xi wants. He wants to gather power inward on the theory that only a strong leader can govern a country in which the mountains are high and the emperor is far away. Getting local governments to toe the line “requires a lot of political brute force, and it’s something you can only achieve if you are extremely vigorous,” says Arthur Kroeber, Beijing-based managing director of economic research firm GK Dragonomics. Kroeber says Xi’s anticorruption campaign seems to warn, “Look, this is the way it’s going to be, and if you don’t like it, we have a lot of space in the jails for you.”

The theme of the third party plenum, held on Nov. 9-12, was “reform and opening up.” That’s a phrase consciously copied from an earlier third party plenum—the one in December 1978 at which Deng Xiaoping began to launch China into the global economy. Deng helped lift hundreds of millions of Chinese out of poverty, giving the world’s most populous nation what is now the world’s second-biggest economy. Xi wants to show his countrymen he’s determined to carry on Deng’s legacy, yet he draws inspiration from the man Deng repudiated: Chairman Mao Zedong. Xi’s father, Xi Zhongxun, fought alongside Mao. According to the official story, Mao saved him from execution, and the elder Xi repaid the favor by sheltering Mao and his troops at the end of the Long March retreat from the Nationalist forces of Chiang Kai-shek.

As a princeling, Xi is determined to demonstrate his ties to the founding generation. Intent on returning China to a purer past, he has presided over a crackdown on corruption that has netted senior party officials—even as members of his own extended family have become rich. He’s brought back the Maoist notion of a “mass line” that enforces ideological discipline by requiring officials to “listen to the people,” introspect, and cleanse themselves of any deviations from party doctrine. He isn’t making it easy for the people to speak, though; in September, China’s top court said Web users could face jail time if “defamatory” rumors they put online were read by more than 5,000 people or reposted more than 500 times.

Xi doesn’t trumpet his differences from his predecessors as an American would. Chinese leaders worry that the people will lose faith in the party if it seems to be swerving in different directions. (“Unswerving” is a big word in China.) So in its 60-point resolution, the Central Committee dutifully name-checks “Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, the important thought of ‘Three Represents,’ and The Scientific Outlook on Development”—those last two being the slogans of past presidents Jiang Zemin and Hu Jintao, respectively. It’s as if Barack Obama obsessively paid tribute to President George W. Bush’s “compassionate conservatism.”

via As Xi Jinping Reforms China, Expect Power Consolidation, Not Democracy – Businessweek.

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Tags: China, Chinese President Xi Jinping, communist party of china, Deng Xiaoping, George W. Bush, Hu Jintao, Jiang Zemin, Mao Zedong, Xi JinPing

20/11/2013

The party plenum: Everybody who loves Mr Xi, say yes | The Economist

COMMUNIST Party plenums are rituals of unchanging arcana. The closed-door, four-day conclave of some 370 senior party leaders that ended in Beijing on November 12th was a typical example, as usual summing up its decisions in a gnomic communiqué full of ambiguities. Yet a parsing of the document suggests President Xi Jinping (pictured above, centre) is tightening his grip on power, and with it his ability to achieve breakthroughs in economic and social reforms.

China’s state-controlled media have hailed the meeting, known as the third plenum of the 18th Central Committee, as “a new historical starting point”. Global Times, an English-language newspaper, said it was just as important as the most famous plenum in the party’s history, which brought Deng Xiaoping to power in 1978 and ushered in profound changes that turned China into the world’s second-largest economy. There is little in the communiqué to back such bullish assertions, but the summary of the proceedings offers hope that the pace of reform will pick up.

For the first time in such a document, the party has called for markets to play a “decisive” role in the allocation of resources. This has been glossed by official media as a step up from previous party language that described the role of market forces as merely “basic”. This new language, according to an academic quoted by Global Times, aroused much debate during preparations for the plenum. Semantics can be very important. The party’s decision in 1992 to create a “socialist market economy”, not just a socialist one, caused an upsurge of reformist zeal, including the privatisation or closure of tens of thousands of state-owned enterprises, as well as market-opening measures that paved the way for accession to the World Trade Organisation a decade later.

As expected, this week’s communiqué contained few indications of specific new policies. These will become clearer in a few days or weeks when the resolution is published, and after senior economic officials meet in December to decide on the country’s economic strategy for the year ahead. There was no mention of financial reforms to allow market forces to determine interest and exchange rates, which many economists view as crucial. On rural land reform, also closely watched, the document merely repeated language introduced at a plenum five years ago about the need to unify urban and rural property markets. Despite its reassuring words about the role of the market, it said the state sector should remain the “main body” of the economy, an odd concept, especially since China’s GDP is now largely generated by the private sector.

But at party plenums, repetition of familiar language is not necessarily a sign of inertia. The meeting in 1978 was laden with Mao-era rhetoric, but led to the ditching of Mao’s economic policies. More important were the signals it sent about Deng’s grip on power, including the return to central roles of many of Deng’s allies who had been purged by Mao. The just-concluded plenum announced two institutional changes that suggest Mr Xi has moved fast to consolidate his position.

The first of these is the setting up of a “state-security committee”. Details of this have not been revealed. It may be Mr Xi’s attempt to rein in a security apparatus that had become too powerful in recent years. Some of its functions are expected to mirror those of America’s National Security Council, which advises the president on foreign policy and tries to ensure that all government agencies are well co-ordinated. China’s new body is thought likely to include representatives from the army and police as well as ministries responsible for foreign and economic affairs. It would be a sign of Mr Xi’s growing power if he has at last persuaded the security forces to act more in concert with the rest of the bureaucracy.

The other notable change is the establishment of a “leading small group” to supervise reforms. Such groups count. They report to the Politburo and help to form and implement policy decisions. Again, no details have been given of the new body, but it could help to overcome bureaucratic rivalries that often stymie reforms. It may even be chaired by Mr Xi. The communiqué calls for “decisive results” by 2020 in unspecified “important areas” of reform.

Not surprisingly, given a fierce crackdown on political dissent in recent months, the document said little about political reform (although for the first time in the history of party plenums, Chinese television indulged in a show of glasnost by broadcasting scenes of group discussions, though participants’ voices could not be heard). The communiqué favourably mentions democracy 12 times, but plenum-watchers learned long ago that this particular count is best ignored.

via The party plenum: Everybody who loves Mr Xi, say yes | The Economist.

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Tags: 18th Central Committee of the Communist Party of China, Beijing, China, communiqué, communist party of china, Deng Xiaoping, plenum, Socialist market economy, World Trade Organization, Xi JinPing

12/11/2013

China vows ‘decisive’ role for markets, results by 2020 | Reuters

China\’s leaders pledged to let markets play a \”decisive\” role in the economy as they unveiled a reform agenda for the next decade on Tuesday, looking to secure new drivers of future growth.

A worker wields a hammer at a demolition site in front of new residential buildings in Hefei, Anhui province, October 19, 2013. REUTERS/Stringer

China aims to achieve \”decisive results\” in its reform push by 2020, with economic changes in focus, the ruling Communist Party said in a communiqué released by state media at the end of a four-day conclave of its 205-member Central Committee.

The self-imposed deadline for progress – rare for Beijing to lay out in such clear terms – together with the creation of a top-level working group and an emphasis on \”top-level design\”, suggest a more decisive reform push by the administration of President Xi Jinping and Premier Li Keqiang than under the previous leadership.

They must unleash new sources of growth as the economy, after three decades of breakneck expansion, begins to sputter, burdened by industrial overcapacity, piles of debt and eroding competitiveness.

\”You should look back in history. When Deng Xiaoping started the reform and opening movement, he actually did something very similar in nature, creating a very powerful working group,\” said Steve Wang, China chief economist with The Reorient Group in Hong Kong.

\”These guys report direct into the power center of the Communist Party. This is definitely not something to be looked at as another layer of bureaucracy, this is something to speed things up, to make things more efficient.\”

The leaders also set up a state committee to improve security as Beijing seeks to tackle growing social unrest and unify the powers of a disparate security apparatus in the face of growing challenges at home and abroad.

While the statement was short on details, which prompted disappointment on social media, it is expected to kick off specific measures by state agencies over the coming years to gradually reduce the role of the state in the economy.

Historically, such third plenary sessions of a newly installed Central Committee have acted as a springboard for key economic reforms, and the follow-up to this meeting will serve as a first test of the new leadership\’s commitment to reform.

via China vows ‘decisive’ role for markets, results by 2020 | Reuters.

Posted in China alert, Economics, Market economy, Reform | Leave a Comment »

Tags: Beijing, Central Committee, China, Communist Party, Deng Xiaoping, Hong Kong, Li Keqiang, Xi JinPing

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