Suggested title: China Seeks a Smooth Leadership Transition



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Suggested title: China Seeks a Smooth Leadership Transition
Suggested quote: The current administration is looking to shore up its achievements, seal its legacy, and most of all, ensure a smooth passing of the baton.
Suggested teaser: Thursday marks the beginning of China's "Two Sessions," and despite the recent calls for a Jasmine Revolution, Beijing seeks a smooth leadership transition and a continuous road map for the country.

China begins its annual "Two Sessions" on Thursday, starting with the Chinese People's Political Consultative Congress (CPPCC), an advisory body, and followed by the National People's Congress (NPC), the national legislature, on Saturday. The event has already experienced the usual outpouring of calls for economic reform, improvement of governance, and alleviation of social problems. Premier Wen Jiabao struck the tone in a recent speech by emphasizing that the country's foremost priority now belongs to improving people's living conditions -- making people "happy," a new official buzzword -- and correcting economic imbalances to benefit households even at the risk of slower growth in the coming years.


The primary focus of the NPC this year will be launching the 12th Five Year Plan, the country's comprehensive goals for the period 2011-15. The importance of these five-year plans is often overstated, but the timing and circumstances that will affect this plan's implementation are significant. The plan has familiar aims -- upgrading the manufacturing sector, modernizing the country's interior provinces, and shifting the economy into a more consumer-driven model -- but it puts greater urgency and emphasis on them than ever before. It allots an estimated $1.5 trillion in new investment over the next five years -- essentially a continuation of the 2008 stimulus package used to fend off global recession. In the post-crisis economic environment, in which there can be no more illusions about the need to shift the growth pattern, the plan is meant to bear the burden of China's structural transformation.
At the same time, the plan will bridge the power transition from President Hu Jintao's administration to the incoming generation of leaders led by likely future President Xi Jinping, providing a continuous road map. By this time next year, China will be in the thick of the leadership swap, and by 2013, a novice leadership will be behind the wheel.
The current administration is looking to shore up its achievements, seal its legacy, and most of all, ensure a smooth passing of the baton. All of this depends on avoiding pitfalls in the coming months. Yet across the country there is a sense of rising dissatisfaction with social conditions that have not kept pace with economic improvements, and dismay at the threat of inflation. The Communist Party's response indicates it takes the air of social tension extremely seriously, wheeling out new measures to boost supply of food and cheap housing, raise wages for urban workers and for soldiers, reduce taxes for the poorest, and putting on various shows of anti-corruption and government accountability.
March is inherently a time of political tension in China due to the 1959 Tibetan uprisings that month, which re-emerged in March 2008. But the atmosphere ahead of the Two Sessions became more frigid with the recent calls by an unknown group for Chinese people to imitate the Tunisian Jasmine protests and take to the streets against the system. The Jasmine group cleverly used the Chinese phrase for the "Two Sessions" (liang hui) as a code to evade government Internet censors. Beijing has tightened security harshly in reaction -- the last thing it wants is an incident of some sort to make a mockery of the solemn affairs of state, or provoke further problems. A protester's assault on Hong Kong Chief Executive Donald Tsang on March 1, at an event commemorating the centennial of China's 1911 revolution, marked a security breach that took on a symbolic meaning in this atmosphere.
But Beijing has an eye on the Jasmine protests for their potentiality rather than their hitherto weak manifestations. It is wary of the Tiananmen model. At that time, Deng Xiaoping was attempting to move out of the leadership role, inflation inspired-unrest caused a division in the Politburo over decision making, and the move to do what was deemed necessary to maintain the regime resulted in sanctions from foreign states. China is far more integrated in the global economy now, and in far more delicate of a position economically. It maintains the current status quo as long as foreign states tolerate it and do not block its trade. The regime will react harshly against domestic ructions to preserve itself, but an incident that galvanizes global opposition would put China in a very difficult impasse indeed. Therefore, despite the stark differences between China and the Arab states experiencing civil unrest, the Communist Party is not self-assured.


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