Who’s who in the new era of Xi Jinping’s China
2 Nov 2022|

The National Congress of the Chinese Communist Party, ostensibly the party’s highest leadership body, is not where real power is contested, but is a performative exercise used to legitimise China’s undemocratic leadership. The recent 20th party congress was no different.

Many headlines were devoted to the escorting of former supreme leader Hu Jintao from the ornate Great Hall of the People. But a closer look at the changes in the composition of high-ranking bodies, and the release of an amendment to the CCP’s constitution, reveal critical clues to China watchers about the country’s future economic and political direction—changes that could have long-term impacts on both China and the world.

With the eviction of the remnants of factional opposition, General Secretary Xi Jinping secured his absolute dominance over the party apparatus. The demotion of Hu Chunhua (a vice premier once regarded as a possible successor to Xi) from the politburo and the exclusion of Li Keqiang (the premier) and Wang Yang (the former vice premier in Li’s cabinet) from the CCP Central Committee symbolised the complete withdrawal of the Youth League faction from the political stage.

Notably, though not outright reformist, these three politicians are seen as reform minded. In addition, a group of the party’s economic experts who have previously supported market-oriented policies and were perceived as friendly to the private economy were either eliminated or retired from the politburo, including banking regulator Guo Shuqing, central bank governor Yi Gang, finance minister Liu Kun, and ‘economic tsar’ Liu He. Instead, devoted Xi loyalists Li Qiang and Ding Xuexiang have been granted seats in the Politburo Standing Committee, and Xi’s long-time friend He Lifeng was elevated into the politburo.

As is common practice in the party-state system, Li Qiang, the second-ranked member of the Politburo Standing Committee, is expected to be named China’s next premier, replacing Li Keqiang at the annual legislative session in March 2023. Ding will likely be appointed executive vice premier, a position that is generally responsible for implementing Xi’s most important economic and social policy directives, while He Lifeng is a potential successor to Liu He. Among this new finance team, only He Lifeng has significant experience in finance at the state level, since neither Li Qiang nor Ding has working experience on economic issues in the state council.

Such promotions clearly indicate the changing requirements to enter Xi’s inner circle, from ability and expertise to loyalty. It has heightened fears that ideology and loyalty to ‘Xi Jinping thought’ will get in the way of much-needed market reforms. In response, the stock market, which might be the only place in China allowed to give a real reaction to the outcome, tumbled on the Monday following the congress. Hong Kong’s benchmark Hang Seng Index experienced its biggest daily drop since November 2008 (though it has since recovered some of those losses).

Xi’s work report to the 20th party congress placed substantially more emphasis on security than reports to previous party congresses. Wu Guoguang, a former member of the central policy group on political reform during the tenure of Premier Zhao Ziyang, said he believes that, although there has been no official announcement, the era of China’s ‘economic construction as the centre’ has come to an end. Security has now been recognised as being of at least the same importance as economic development.

Those views are corroborated by the party’s newly amended constitution announced last Wednesday, in which ‘secure development of the economy’ was added for the first time. Given the sluggishness of China’s economy at present, and the growing questions about whether China’s meteoric economic development has reached its end, strategies for strengthening government control, domesticating market forces and maintaining the stability of a regime whose legitimacy has rested on economic development will become the primary focus for the CCP under Xi’s control.

The new line-up of the CCP Central Military Commission heralds a worrying future for the situation across the Taiwan Strait. Xi’s promotion of 72-year-old Zhang Youxia to first-ranked vice chairman of the committee indicates an end to the age-restriction convention for membership of the Politburo Standing Committee known as the seven up, eight down (七上八下) rule. Zhang, regarded as a close associate of Xi, was a company commander during the Sino-Vietnamese War in 1979 and is one of few senior generals with actual combat experience.

Another general rewarded with an exceptional promotion is He Weidong, who was confirmed as the second-ranked vice chairman of the commission. During the 20th congress, he advanced three ranks to the politburo. He served in the 31st Group Army in Fujian (now the 73rd Group Army), known as the frontline force against Taiwan. In 2019, he was appointed as the commander of the Eastern Theatre Command and was the main planner of the large-scale live-fire military drills and missile tests surrounding Taiwan after US House of Representative Speaker Nancy Pelosi’s visit in August.

The reshuffle at the top of the Central Military Commission demonstrates Xi’s preference for both political reliability and tactical skill, highlighting the required traits for military leadership in the case of a Taiwan contingency. Given these new developments, Taiwan’s defence minister, Chiu Kuo-cheng, believes the People’s Liberation Army will ‘adopt a tougher strategy in dealing with Taiwan in the future.

Since the 19th party congress, the Taiwan issue has been elevated from being a regional affair to now being a key part of the ‘great rejuvenation of the Chinese nation’ proposed by Xi. Xi’s work report to the 20th congress has reiterated this talking point. Retaining the old CCP script, Xi again vowed never to renounce the use of force.

In addition, the new amendment to the party’s constitution indicates a clear escalation by stating the CCP’s commitment to ‘resolutely oppose and deter separatists seeking “Taiwan independence”’. Given this escalation, signals of outside deterrence are important, especially when there are no checks and balances within the party. Countries that value the status quo international order must demonstrate their determination to intervene more clearly to avoid a Chinese strategic miscalculation.

Highly concentrated political power has always been propagated as China’s proud governance advantage. Today, that concentration of power has reached new levels, with the decades-old oligarchy quietly collapsing and Xi’s elevation above factional politics secured. In his unrivalled ability to direct and dictate China’s course, Xi is perhaps one of the purest manifestations of ‘a dictator’ in recent history. But with political decision-making resting on the shoulders of one man, how Xi responds to policy failures and successes will have big implications for China, and indeed the world.