After the 19th Congress, Xi’s China is preparing for a new roadmap domestically and internationally. This is Dr. Dan Steinbock’s in-depth analysis of China’s critical changes that will shape the world economy until 2022 – and beyond.
As the 19th National Congress of the Chinese Communist Party (CPC) opened in Beijing, General Secretary Xi Jinping delivered a report about “building a moderately prosperous society” for a new era. In his speech, Xi offered a blueprint for China’s development for the next 5-15 years.
Afterwards, the Congress unveiled the new leadership team who will be ultimately accountable for Beijing’s evolving grand strategy and its execution that will shape China and the world in the next five years.
Leadership transition: From 5th Generation to 6th Generation
China’s first leadership – from 1949 to mid-70s – featured Mao Zedong, his foreign affairs expert Zhou Enlai and half a dozen other core leaders. These were mainly Communist revolutionaries born around 1886 and 1907; that is, during an era of imperial disintegration, colonial divisions, and the nascent efforts at Chinese republic.
The current Xi-Li Administration came to power at the 18th Party Congress in 2012. Most of these leaders were born around 1945-55 and educated at elite Chinese universities. They comprised fewer engineers but more managers and finance majors, including business executives. They grew up during the years of Cultural Revolution, but built their lives amid economic reforms and opening-up. They were more professional, share a more international outlook and remain determined to shape a new China for the 21st century.
Five years ago, Western media far too often portrayed the Xi-Li team as hard-core conservatives who would reject economic reforms. In contrast, I argued on CNBC in New York City that this was a gross misperception that reflected poor understanding of China’s actual past and potential future. “China,” I argued, “is moving toward liberal reforms, but such changes require tough hands.”
In 2012, China did not opt for leaders who had a reputation for rhetorical eloquence but poor performance. Instead, China’s new leadership featured tough doers who were known for getting things done. Such leaders are necessary to transcend entrenched interests and to move China toward the post-industrial society. That’s what the Xi-Li team initiated in the past half a decade and it is likely to complete by 2022. That is when the 6th generation will take over- Chinese leaders born in the 1960s and thus with no personal experience of the Cultural Revolution.
Half a decade ago, I argued on CNBC that the 2017 leadership would also consist of tough hands but ones that would be determined to achieve a more open and transparent China, with liberal market doctrines but socialist long-term objectives. And that’s precisely what hundreds of millions of Chinese TV viewers saw as Xi introduced the other six Standing Committee members at a press conference, which was broadcast live.
The address ensued after Xi’s name had been added to the Party constitution, which puts him on a part with late paramount leaders Mao Zedong and Deng Xiaoping. Indeed, each of these leaders exemplifies critical phases in China’s postwar history. It was Mao who made possible a sovereign China and peace that allowed the first efforts at industrial take-off. But China’s industrial revolution did not materialize until Deng took over in the 1980s. After three decades of dramatic industrialization, Xi’s first team began the transition to post-industrial society in 2012, which his second team is likely to complete.
The full line-up of the new Politburo and its ultimate leadership Standing Committee includes Party General Secretary Xi Jinping (born in 1953), who accounts for China’s grand strategy, and Premier Li Keqiang (1955), an economist who did his PhD on the restructuring of Chinese big businesses and is exceptionally well equipped to execute the impending reforms.
Who are the new Chinese leaders?
Wang Yang: Liberal Voice
Wang Yang (1955) is one of Li Keqiang’s four vice-premiers who is expected to become chairman of China’s top political advisory body, the People’s Political Consultative Conference. While Wang is perceived as one the most “liberal” members of Chinese leaders, that’s only a part of the story. He grew up in an urban working-class family in Anhui, a landlocked, agricultural and poorer province in eastern China.
Starting as a food processing factory hand, Wang joined the CPC in 1975, served as an instructor in the local Party School and went on to study political economics in the Central Party School in 1979, right at the dawn of Deng Xiaoping’s economic reforms.
After the local Communist Youth League (CYL), deputy head of the National Development and Reform Commission (NDRC) in the late 1990s, deputy secretary general of the State Council in 2003-5, Party Secretary in Chongqing. He began to modernize the megacity of more than 30 million people, and Party Secretary of Guangdong, another critical stepping stone.
Credited with pioneering the Guangdong model of development, exemplified by private enterprise, economic growth and a greater role for civil society, Wang began to diversify Guangdong’s economy away from manufacturing already in 2007 to develop Shenzhen into an innovation hub for China’s new economy. He also became an outspoken critic of corruption and nepotism and went against the “princelings”; the prosperous descendants of early revolutionaries who had not earned their own wealth.
In the past half a decade, Wang has overseen several portfolios in the Li administration and often accompanied Xi and Li on trips abroad. Unlike many of his peers, Wang is known for offhand dry humor. During the 2013 US-China Dialogue, he compared the bilateral relations with a marriage. China and the United States should not “choose the path of a divorce,” he said adding, “like that of Wendy Deng and Rupert Murdoch, it is just too expensive.” Wang is among those Chinese leaders who could follow Xi or Li in the 2020s.
Zhanshu: Security and Foreign Affairs Specialist
Li Zhanshu (1950) is one of Xi’s right-hand men and his chief of staff. Well before the 19th Congress, Li stood a good chance of becoming chairman of China’s parliament, the National People’s Congress.
