Jiang Zemin

Jiang hedges bets on the west

PUBLISHED : Wednesday, 30 August, 2000, 12:00am
UPDATED : Wednesday, 30 August, 2000, 12:00am

DESPITE PRESIDENT Jiang Zemin's tight grip on the Communist Party and state affairs, a considerable degree of what sinologists call 'inner-party democracy' manifested itself in the just-ended leadership conferences at the Beidaihe seaside resort.

According to cadres familiar with the proceedings, there was a remarkable divergence of views on the three major topics raised: the development of the western provinces, preparation for the country's accession to the World Trade Organisation (WTO), and the rejuvenation of party cadres. At an informal session with central and regional cadres at a beach-side pavilion, Mr Jiang said: 'The party must do all it can to jump-start the economies of the poor western provinces in 20 to 30 years.'

The president called on officials to learn from how Washington developed California and the western states in the late 19th and early 20th centuries. Yet neither Mr Jiang nor Politburo colleagues such as Premier Zhu Rongji felt confident enough to lay down a road map for the difficult task.

Controversy erupted over whether Beijing should try to revive the western areas mainly through boosting financial aid. Since the party leadership first raised the 'go west' banner late last year, cadres in provinces ranging from Guizhou to Qinghai have asked for more transfer payments and subsidies. Moreover, subventions for districts with heavy concentrations of ethnic minorities such as Tibet and Xinjiang are seen as essential to containing Tibetan and Uyghur pro-independence movements.

According to a State Council expert attending the Beidaihe meetings, however, a number of cadres argued that giving out more subsidies would merely increase the sense of dependence on Beijing. 'It was noted that subsidies to Tibet have had minimal effect on local development,' the expert said. 'For example, much of the funds from Beijing end up as sacrifices [by faithful Tibetans] to the lamaseries.'

Advisers close to Mr Zhu favoured asking the successful state-owned enterprises (SOEs), mostly those based in eastern cities, to invest in the west and even move some of their operations there. Various western provincial administrations have also offered to let SOEs from cities such as Shanghai and Guangzhou acquire their state firms free of charge.

Coastal cadres attending Beidaihe, however, reportedly said few entrepreneurs in their areas were interested. The cadres cited examples of eastern SOEs suffering huge losses in the hinterland for reasons including notoriously high levels of corruption in western regions. Because of these reservations, Beijing has not come up with a mandatory policy to oblige coastal SOEs to go west.

On the fringes of the Beidaihe talks, several avant-garde economists raised the possibility of 'turning a couple of western cities into Chinese-style Las Vegases'. They were, however, reminded by more conservative cadres that gambling and other 'decadent' businesses went against Mr Jiang's crusade to build spiritual civilisation.

Mr Zhu presided over a number of informal meetings on WTO accession, during which heads of ministries and provinces made presentations on how their units would handle the shock of global competition.

Mr Zhu is understood to have made two main points. One was that SOEs should speed up the pace of mergers and acquisitions to produce 'world-class conglomerates' that can take on multinationals.

Secondly, the premier indicated, central and provincial authorities should promote competition within sectors including politically sensitive ones such as telecommunications - and they should curb regional protectionism.

Mr Zhu largely endorsed the recent price wars that had erupted in fields ranging from colour TV sets and cars. He scolded individual provinces, including Sichuan, for propping up inefficient SOEs through hidden subsidies and through policies discriminating against products from other regions.

However, according to a source familiar with the debates, a number of cadres at Beidaihe said privately that SOEs should be encouraged to build their strength before the multinationals were allowed to come in a few years after WTO accession. They claimed that cut-throat competition at too early a stage would lower profits, sap the vitality of state firms, and prevent them from concentrating on long-term goals such as research and development.

Given that the personnel issue has a direct bearing on the political fortunes of major factions and personalities, the question of rejuvenation elicited the hottest debate at Beidaihe. There were vigorous discussions on the types of cadres who should be promoted to senior positions at the 16th party congress in 2002.

Mr Jiang and proteges including the head of the Organisation Department, Zeng Qinghong, emphasised the criterion of political trustworthiness. Moreover, Mr Jiang's aides said that this quality could be gauged according to how well a candidate for elevation understood the president's teachings on issues ranging from party construction to technological innovation.

More moderate elements in the party, including Mr Zhu, pointed out, however, that zhengji - 'administrative achievement' or a track record in reform - was a more relevant criterion for promotion in the 21st century.

Several rising stars that Mr Jiang is pushing for elevation at the 16th congress, including Mr Zeng and Guangdong party secretary Li Changchun, are seen by politicians outside Mr Jiang's own faction as having made their mark through currying favour with the president rather than solid attainments in reform.

At the resort, Mr Jiang reiterated to intimates that he would stick to his earlier decision to leave the post of party general secretary in 2002 - and state president in 2003. This was largely welcomed by Beidaihe conferees. However, his advisers also started canvassing the views from different factions and politicians on Mr Jiang's plans to stay on as chairman of the Central Military Commission until the 17th party congress in 2007.

Mr Jiang's aides cited two reasons why the president, who first became commission chief in 1990, should hold on to the crucial position. The first was the need for an experienced leader to handle the Taiwan issue, which might involve some form of military action.

The second reason was that only a cadre of Mr Jiang's standing could ensure that the new generation of increasingly assertive military officers would stick to the principle of 'the party wielding control over the gun'.

Politicians with enough stature to criticise Mr Jiang in party gatherings, such as former parliament chief Qiao Shi, were absent from Beidaihe. However, reform-minded cadres are known to have expressed reservations about Mr Jiang's power lust.

Because Beidaihe conferees spent more time than they had expected on issues of economic development and personnel, Taiwan was not discussed at length. Informed sources said there was a near consensus that because there was no effective means to force the administration of President Chen Shui-bian to make concessions on areas including the one-China principle, the difficult problem should be put off until next year.

Willy Wo-Lap Lam is a Post Associate Editor

Graphic: casinogfa