China has this morning presented its new leadership in the Standing Committee (SC) of the Politburo. The line-up was as expected following the news reports yesterday as outlined in our Flash Comment China: Xi gets name in Constitution, Wang Qishan steps down. The new SC points to continuation as the number of members is unchanged at seven and the five new members represent different factions of the Communist Party. The ‘7 up, 8 down’ informal rule was also respected. Hence, Xi Jinping did not aim for a strengthening of power in the SC. However, the new SC has no successor to Xi Jinping as President in 2022, which will add to speculation that he may stay on after his second term. By striking a balance on power and keeping to informal rules, it may also increase party support for Xi Jinping staying on after 2022. But only time will tell.
With the Party Congress now behind him and a team Xi Jinping has been forming, we believe focus will turn to a further reform push in 2018.
The key takeaways from the new Standing Committee:
In our preview to the Party Congress Research: Why the Party Congress is key for China’s road ahead, 3 October 2017, we highlighted a number of things to look out for. Below, we look at how they have turned out:
Number of people in the Standing Committee. It turned out the number was unchanged at seven. Had it been reduced, it would have been a sign of stronger power for Xi Jinping. But this turned out not to be the case.
Who has been appointed? The people in the new SC represent different factions of the party, which points to continuity. It includes reformers like Wang Yang, who has also been connected to the Youth League – a faction that Xi Jinping has generally given less influence. A strong theorist like Wang Huning with no administrative experience (as normal for SC members) also made it to the SC. It indicates that Xi Jinping will continue to focus on a strong theoretical backbone in the leadership. Zhao Leji will take over the leadership of the corruption campaign from Wang Qishan. Li Zhanshu is a strong administrator and is Xi Jinping’s man. Han Zhen has been the Party Secretary of Shanghai and often been linked to Jiang Zemin. Li Keqiang stayed on as Premier as widely expected recently but in contrast to speculation earlier that Xi Jinping would replace him with Wang Qishan and break the informal age rule.
Will the ‘7 up, 8 down’ rule be respected? It was speculated that Xi Jinping would break the ‘7 up, 8 down’ rule that states that a member has to be below 68 when a new term starts. This would have allowed him to keep Wang Qishan, the anti-corruption tsar and generally considered to be China’s number two leader after Xi Jinping. However, here also Xi respected the party line and Wang Qishan has stepped down.
Will Xi Jinping designate a successor? As mentioned above, no successor has been designated to succeed Xi Jinping as China’s leader when his second term expires in 2022. None of the members of the new SC are young enough (57 or younger) to be able to serve one five-year term on the SC and after that be a leader for two five-year terms if the ‘7 up, 8 down’ rule is to be respected. It may be that Xi Jinping wants more time to find his successor. But it clearly raises the probability that he could stay on for a third term. The emphasis of ‘a new era’ and need for strong leadership in the new era could point in this direction. However, we are likely to have to wait a few years to see if a successor evolves.
What will Xi Jinping put in the Constitution? It became clear yesterday that Xi Jinping got his name in the Constitution with his new thinking: ‘Socialism with Chinese characteristics in a new era’. It clearly underlines the power of Xi Jinping. Only Mao Zedong and Deng Xiaopeng have their names in the Constitution while the two previous leaders Jiang Zemin and Hu Jintao did not achieve this. Also, Deng Xiaopeng only got his name in the Constitution after his death. In this respect, Xi Jinping can be seen as the strongest leader since Mao.
What will the work report say? The Work Report was read on the first day of the Congress in a 3½ hour speech. It also points to continuity and further focus on reforms and innovation. It indicates a rising focus on quality of life and economic growth rather than explicit growth targets. Xi Jinping stated that China is on its way to reaching the goal of a ‘moderately prosperous society’ by 2020 and stated a longer goal of by 2050 becoming a ‘great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious and beautiful’. He highlighted two stages on this journey – a first stage from 2020 to 2035 and a second stage from 2035 to 2050. He did not attach new growth targets to the next stage, though, which further indicates less focus on growth targets and more on raising living standards, more broadly including limiting pollution.
To sum up, Xi Jinping ended up striking a balance between respecting continuity and following tradition and party rules while at the same time strengthening his power by getting his name in the Constitution and not designating a successor.
