Whether he is the new Deng Xiaoping will say much about the contours of the evolving global order
My post earlier this week argued that China’s long-term prospects are more uncertain than the conventional wisdom holds. The country’s new leader, Xi Jinping, is raising hopes that he is the man to tackle the daunting array of challenges the People’s Republic confronts. But even if he is as reform minded as some believe, a new Wall Street Journal report illustrates just how herculean a task he confronts.
The five-day tour of Guangdong Province Xi just completed has many speculating that he is serious about pushing ahead with deep changes. In his first official trip outside of Beijing since becoming Communist Party chief last month, he paid symbolic tribute to Deng Xiaoping’s landmark 1992 tour of the province that re-catalyzed economic reforms which had stalled in the wake of the Tiananmen Square protests three years earlier. Xi’s father was Deng’s close associate and oversaw the establishment in 1980 of the special economic zone in Shenzhen that provided a gateway for foreign investment into China and transformed an obscure fishing village into a global manufacturing hub.
During his visit to Shenzhen, Xi laid a wreath at a statue honoring Deng and visited a private Internet company. Echoing Deng’s liberalization program, Xi declared that “Reform and opening up is a guiding policy that the Communist Party must stick to. We must keep to this correct path.”
Journeying on to nearby Guangzhou, Xi announced that “We can brook no delay” in pursuing reforms. He added that “We need to have more political courage and wisdom, and not waste any more time.”
But it is still unclear how Xi intends to give substantive meaning to these words or what he actually means by “reforms.” It also is curious that the state media gave minimal fanfare to his trip. And even if he intends to push forward with more market-oriented economic policies, it is not certain the entrenched interests within the party that are literally profiting from the status quo (here and here) will give him much latitude. At least one prominent expert on Chinese politics doubts it.
This point was underscored a few days ago in a Wall Street Journal report that well-connected state-owned enterprises were stymieing key economic reforms advocated by outgoing Premier Wen Jiabao. According to the article, Wen had wanted to ease the rising problem of social inequality (here and here) by cutting back on the huge profits enjoyed by state-run companies but instead faced a powerful backlash. Indeed, Wen’s irrelevancy during much of his premiership is a cautionary tale of how resistant the Chinese system is to fundamental change.
It also is noteworthy that at the same time Xi’s appointment as party chief was being formalized, Beijing shied away from reform and instead resorted to the familiar but inefficient tactic of higher infrastructure spending in order to boost the sputtering economy.
Whether Xi lives up to the hopes now being invested in him will go a long way in determining the contours of the evolving global order as well as the accuracy of the most confident prophecies of China’s global ascendency – brazen examples here, here and here. If he doesn’t, the counter-arguments about America’s strategic resiliency made in this blog and elsewhere will be strengthened.