New world order: Xi’s China dream

When the history of post-Deng Xiaoping China is reviewed the keynote address given by party boss Xi Jinping to the 19th Congress of the Chinese Communist Party in October 2017 will likely come to be regarded as a signal moment, even the beginning of a new phase.

" Xi remains a dominant figure the world will have to reckon with a more assertive China."

Whether Xi achieves his 'China Dream’’, as he describes his ambitions for a restoration of China’s greatness, remains to be seen, but what can’t be denied are his ambitions.

He was not overstating the challenges his country faces in its transformation from an investment-led to a consumer driven economy when he said China was at an “historic juncture’’ in “the great rejuvenation of the Chinese nation.’’

Significantly, he appeared to depart from growth-and-more-growth dictums of his predecessors when he called for more inclusive growth rather than focusing on GDP growth targets.

Pointedly, he did not refer specifically to China’s goal of doubling GDP between2010 and 2020, although it seems well on track to achieve this target.

Whatever else might be said about Xi’s embrace of a more traditional strongman role this was an address of a self-confident successor to Mao and Deng in his political prime.

A low profile

Since the paramount leader’s death in 1995 China has been ruled by relatively ineffectual leaders who basically followed the Deng script, emphasising a further opening to the outside world and the building of socialism with “Chinese characteristics’’.

This involved a continued a loosening of state controls on business and increasing engagement in international forums as China cautiously threw off shackles that had constrained such engagement. The canny Deng advised ‘keep a low profile’ -- or in Chinese tao guang yang hui.

Party bosses Jiang Zemin and Hu Jintao were largely content to maintain the status quo politically, even as a dynamic Chinese entrepreneurial class, untethered by ideological and other constraints, supercharged the economy.

However, all this came at a cost as corruption took deeper root and confidence in the ruling Communist Party dissipated.

Enter Xi Jinping, endorsed at the 18th Party Congress in 2012 to lead China for the next five years.

It has been overlooked in the swirl of events since but Xi’s came to power at a moment of considerable uncertainty in China, beset by corruption scandals, leadership infighting and a sense the country was drifting despite its impressive economic performance.

Xi should, therefore, be given credit for steadying China, restoring a reasonable level of confidence in the country’s leadership, rooting out the worst of the corruption and expanding Beijing’s international engagement.

None of this should be read as an endorsement of Xi’s approach to getting rid of his political opponents, many of whom have been accused of corruption, putting constraints on the media, including social media and stifling democratic tendencies.

Xi’s tenure has been reminiscent of a traditional political boss, strengthening his control over the party, limiting scope for dissent and lending himself to the promotion of what would have been described in the Mao-era as a personality cult.

All these observations are valid, but what is also the case is that Xi has emerged as a forceful leader whose global footprint is expanding beyond his country’s frontiers at a moment when America’s leadership role is ragged.

Dominant figure

Whether its neighbors, including Australia, like it or not it is clear that as long as Xi remains a dominant figure the world will have to reckon with a more assertive China.

We are a long way from the 1980’s when Deng advised his leadership colleagues that in its dealings internationally China should “observe calmly, secure our position, cope with affairs calmly, hide our capacities and bide our time. Be good at maintaining a low profile and never claim leadership.’’

Those words have been variously interpreted as relevant to the times when China was at an early stage of its opening, or, alternatively, as a strategic ruse to encourage the rest of the world to underestimate its ambitions.

Perhaps it was a bit of both.

What is absolutely clear now is that the biding-our-time era has passed. This was underscored, embellished and set in stone by Xi Jinping marathon three-and-a-half-hour speech to the opening session of the Congress.

Prosaically titled the “work report’’ of the General Secretary of the Chinese Communist Party, Xi ranged far and wide in remarks that will have been scrutinized across the globe, among China’s neighbors, and in Western capitals for indications of where the country may be heading.

Xi’s primary aim will have been to consolidate his authority among members of the Central Committee, the Politburo and the soon-to-be-announced seven members of the Politubro’s Standing Committee, the body that effectively runs China day-to-day.

Foreign business, jaded by what is describes as “promise fatigue’’ – this is reference to the difficulties of engaging an opaque system -- will have paid sceptical attention to Xi’s pledge to improve the commercial environment.

“China won’t close its open door – the door will only opened wider and wider,’’ he said. “This includes reducing market entry restrictions on foreign businesses, protecting foreign companies’ legal interests, and treating them equally to their domestic counterparts.’’

Foreign business has grounds for scepticism given the overall economic thrust of Xi’s remarks in which seemed to retreat from a pledge to liberalise dominant state-owned enterprises.

Indeed, he appeared intent on reasserting Party control over SOE’s, preferring to streamline their management rather than fundamentally shift their role in the economy.

SOE’s are set to play a pivotal role in Xi’s signature One Belt, One Road -- or Belt and Road – Initiative (BRI).

In his marathon address Xi didn’t neglect an overarching vision for his new dream in which he pledged his country would be “moderately prosperous’’ by 2020;  a “socialist moderniser’’ by 2035; and a “great modern socialist’’ global power  by 2050.

Xi gave no indication of his own ambitions, but given his growing political dominance it would not be surprising if the 64-year-old’s tenure extends past his nominal retirement age of 68 achieved before the 20th Party Congress in 2022.

Tony Walker is an author and former Washington correspondent, international editor, Middle East editor and senior political editor at The Australian Financial Review and The Financial Times.

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

editor's picks

16 Oct 2017

New world order: a bridge to China

Tony Walker | Author and Political Analyst

Shifting power balances and China’s developing BRI presents key decisions for the next Australian government.

18 Oct 2017

LONGREAD: China’s green shift and how Australia should respond

John A Mathews | Professor of strategy at MGSM, Macquarie University

China has adopted a new energy strategy with determination and ambition. Australia needs to position itself strategically.