China: New leaders, new challenges

The greatest show on earth in political theatre is over in Beijing and as Xi Jinping led six other dark-suited men on the red-carpeted stage of the Great Hall of the People on Thursday, the world had its first glimpse of the men making up the Standing Committee of the Politburo which will rule China.

There was no surprise in the denouement as far as the two principal characters were concerned, Mr Xi as President Hu Jintao’s successor as Communist Party chief, and Mr Li Kenqiang set to succeed Premier Wen Jiabao although the presidency and prime ministership will change hands only in March next year.
If the world’s Sinologists and other experts examining recent events in Beijing through a microscope were underwhelmed and somewhat disappointed by the climax, they were muted in their reactions. The truth is that conservatives dominate the all-important Standing Committee and the hidden hand of the octogenarian former President Jiang Zemin is apparent; it tilts towards the conservative bent. The one feather in Mr Xi’s cap is that he has won the chairmanship of the military commission, instead of waiting for two years, as his predecessor had to. And he adopted a less formal style in his brief address to the international media, to the delight of the country’s army of netizens.
If the intention of the collective Chinese leadership was to make an outwardly smooth changeover the second time round, it succeeded, putting the horror of the disgraced Bo Xilai behind (and ahead of) it. And with the generation change, the princelings, descendants of the revolutionary heroes, have come into their own. Tussles among the various party factions were enacted behind the curtain, the optimists consoling themselves with the thought that Mr Xi will be able to effect changes in the Standing Committee more to his liking in five years, given the age of some of the new entrants, his own term customarily lasting 10 years.
Mr Xi did not give much away in his first address as Communist Party leader, except to stress the prospect of greater prosperity and enhancing the country’s strength. After Mr Hu’s marathon opening the 18th Party Congress, he made an obligatory bow to the evils of corruption. Few Chinese believe that Mr Bo, whose wife is serving a suspended death sentence for murdering a British business associate, is a solitary case.
Little is known about Mr Xi’s personal life, except that he suffered during Mao’s Cultural Revolution, but after the dust settled on the post-Mao era, he was noticed by Deng Xiaoping of the “to be rich is glorious” fame and was given high level jobs. Serving in coastal provinces and having travelled the world, he is far better aware of the universe than his predecessor. He is married to a famous singer (whose career would now seem to be over) and they have one daughter who, like the disgraced Bo’s son, studies at Harvard but under an assumed name. The new leader has close links with the Army by virtue of his princeling legacy.
As Mr Xi himself acknowledged, he faces enormous challenges after the extraordinary economic progress of the country, displacing Japan as the world’s second economy. The old success formula of vast investments on public works led by a predominantly export-led economy fed by state enterprises has seen its best days. A change in the economic mix to encourage greater consumerism is touted, but any radical reform of behemoth state enterprises would seem to be ruled out because their main stakeholders are in power.
Initially, the world will judge Mr Xi by how he copes with his two main challenges: attitude to relations with the United States and his treatment of neighbours. China’s relations with Washington have been strained in recent times not merely over trade disputes or the undervaluation of the yuan but over its deep suspicion that President Barack Obama’s declared “pivot” to Asia is a policy of containing Beijing. Both these problems are linked with China’s exaggerated sense of its power, given its impressive economic muscle and accelerating military might.
A dangerous ingredient of the twin problem is that having embraced capitalism with such enthusiasm, the Communist ideology is hollow, with the rulers replacing it with nationalism. Recent anti-Japanese riots following the exacerbation of the dispute over the Senkaku-Daioyu islands controlled by Japan are one indication. The spats with Vietnam and the Philippines over disputed seas are another. No country wants to be bossed over and the image of an assertive, if not aggressive, China sits ill with neighbours. The border dispute with India is, for the moment, on the backburner because Beijing is disinclined to resolve it in a hurry.
The future has other challenges for the new Chinese leadership. The Chinese middle class is both better educated and more prosperous and certainly enjoys greater personal freedoms than their parents did. They are also more rebellious fighting censorship and great restrictions on political speech on millions of Internet websites through microblogs by negotiating their way around censors. They are particularly outraged by the levels of corruption among the ruling elite and the growing inequality between the rich and the poor.
Thus far the Chinese leadership have not factored in the consequences of hundreds of thousands of Chinese students going to elite institutions in the West, in particular the US and Britain. In a sense, they represent a subversive army, given the un-free nature of Chinese society in the political context. A second problem Mr Xi faces, if one assumes his reformist tendencies, is even more formidable: reforms have a built-in limit because there is general agreement among the ruling elite that the Communist Party’s legitimacy, which is co-terminus with their power base, cannot be questioned. China cannot afford to lose its best and brightest by a continuing exodus determined by their sense of insecurity. Those who can afford to have taken a second passport and have bought apartments in the wealthier districts of the world’s major capitals.