archyworldys

China’s new emperor is clumsy and that’s a bad thing

There is always weakness everywhere, wrote Chinese strategist Shang Yang, but a good monarch knows how to deal with it. China’s current strongman, Xi Jinping, is less coping today. He is failing to reform his country sufficiently, and his harsh policies are fueling resentment. In the run-up to the important party congress this autumn, there is a behind-the-scenes debate about how the country should proceed. There seems to be no alternative to Xi and hard times are inevitable.

We must start an analysis of China with an acknowledgment of progress. No other country has reduced poverty on such a scale. That means Xi may remain one of the most popular leaders. The impact of propaganda and censorship aside, more than 80 percent of Chinese still trust their government. In Western Europe this usually fluctuates around 30 percent.

burst

Yet there are cracks in that confidence, especially due to the handling of the covid pandemic. Slogans appeared all over the Chinese streets and on social media calling on people to get vaccinated. Less than 50 percent of the elderly have had the three vaccinations administered. A flexible policy could therefore lead to tens of millions of premature deaths: a scary scenario, especially with the images of the overcrowded morgues in Wuhan two years ago in mind.

That explains the hard lockdown. According to Nomura, a consultant, 373 million Chinese in 45 cities have since been placed in isolation. The stories are sometimes heartbreaking: old people being separated from each other, shortage of food, no access to medicines, servants who stay in the office for weeks.

Shanghai was the most extreme example, but also in Beijing more and more residential blocks are closed with fences. Hundreds of students rioted on the campus of the famed Peking University when their rooms were barricaded and denied the right to food delivery.

The motto is now buzzing among the young highly educated: “Flight!” More and more young people in the cities want to migrate. The big problem for China is that the current tough measures are not effective in the long term. So far there have been few casualties due to Covid, but there is also little immunity. Even the World Health Organization, which has praised China for years, argues that this approach doesn’t work.

Beijing, however, does not want to be criticized and accuses the West of wanting to break morale. “Perseverance is victory,” President Xi replied.

great leader

Let’s face it: rebellion is limited. Even in Shanghai there were only disturbances and balcony protests. Protesting in China is also pointless. Several critical voices have already gone behind bars, and under Xi, oppression options have expanded further. This also explains why there has been less unrest and fewer uprisings in recent years. In the countryside and in the smaller towns, the propaganda is also more intense and no cat thinks about fleeing. Xi has also focused its poverty reduction programs on those areas. It’s a bit like the British philosopher David Hume put it: authoritarian rule thrives better in rural areas than in cities.

Yet his approach is risky. Until now, Chinese frustration has focused on local governments and capitalism. The great leaders at the national level were kept out of sight. But now the great leader, Xi, has tied his status to as few Covid victims as possible through large-scale quarantine. He has also publicly reiterated its importance. In diplomatic circles you hear that some other party leaders and officials within the government suggested a different approach late last year, but got the short straw. If it turns out that Xi’s strategy doesn’t work, he will pay a price for it.

We will see that especially in the coming months. After all, the party congress will take place this fall. That is the largest meeting of the Communist Party. Prior to that, smaller party organs will consider leadership. Xi Jinping will almost certainly be confirmed for a third term, but the discussion will mainly revolve around who will sit next to him in the powerful Politburo, or in the even smaller and more powerful Standing Committee. Eight of the eighteen members of the Standing Committee and three of the seven members of the Politburo are to be replaced.

Old men

The power struggle that is now taking place is opaque. Xi has relentlessly eliminated his rivals since taking office in 2012. So there is a lot of fear, and in broad regions of the party there is resignation: there is no alternative for Xi. And so it is. Normally, potential successors are prepped for years. That is not the case now. Many assume that Xi will want to stay on until 2032 or even 2037.

Resistance can still be offered by the so-called Party Elders: retired leaders such as Hu Jintao and Jiang Zemin. They have large networks within the party. But Xi has not turned his back on tackling their stalwarts. Even the options of the Party Elders are thus limited. It will mainly have to be an interaction between the elderly and the lower echelons of the party. For example, local governments are concerned about Xi’s direction, as are several economic sectors.

So the most likely scenario is that Xi will remain chairman of the party and thus also president of China, that his prime minister will become a malleable figure, and that he will also be surrounded by pliable compromise figures in the Politburo. Little stands in his way then. The army, the security and propaganda services eat from his hand. Large companies appear to have little influence. Chinese technology companies such as Tencent and Alibaba were ‘disciplined’. Foreign companies can choose: adapt or leave.

Pieces

It is this economic context that will be a major obstacle for Xi Jinping. Because although brands such as Polestar and Xiaomi are gradually conquering the world and China is leading the way in a number of innovation clusters, the huge investments in research continue to yield relatively less than in other economies. For every billion invested in research, the EU yields 34 internationally recognized patents, in China there are 19. Productivity in China is evolving negatively across the board. For the first time in decades, international investors are beginning to doubt.

Over the past year, I’ve heard many business leaders suggest that it can’t go on like this, including some who have billions locked up in the country. “The approach to covid shocked us: you just no longer touch people and you no longer touch things,” a prominent Dutch CEO formulated. “The image of a far-sighted government has been shattered. We have been naive for a long time. It will be difficult, but have to work on an alternative.”

Little by little, even the most pragmatic of investors are beginning to realize that the million Uyghurs sent to re-education camps, including children, are unimaginable.

We are seven years after Xi took office, and it has been a long time since there has been so much uncertainty about the future of China’s growth story. Growth continues to slow, but the economy is not getting any more balanced. The debt is rising, but the investments made with it are less profitable.

Even the social promise of ‘joint prosperity’ is not being fulfilled. In recent years, inequality in China has risen again and is once again approaching US inequality levels.

China’s new emperor is bungling and that is a bad thing: for China itself and for the whole world.

Read also  Soon a big Disney cine-concert at the Zénith in Lille

Trending