18th Party Congress
The Chinese Communist Party's 18th Congress, held in Beijing November 8-14, 2012, marked a key power transition in China. A new generation of leaders, headed by Xi Jinping and Li Keqiang, took over from the previous leadership headed by Hu Jintao. The Communist Party's Politburo Standing Committee was reduced in number from nine to seven. Unlike his predecessor Jiang Zemin, Hu Jintao handed over both the Party General Secretary and Chairman of the Central Military Commission positions to Xi.
New leaders must guide China to the next stage of its development
China's next generation of leaders is now known, their unveiling yesterday ending months of speculation as to who the Communist Party would choose to take the nation through the coming decade. Xi Jinping heading the line-up of seven dark-suited members of the top governing body, the Politburo Standing Committee, was not surprising, nor was the choice of the man who stood beside him in the No 2 spot, Li Keqiang. But the others on the red carpet in the Great Hall of the People were there less through rank than bargaining and back-room deals by factions and interest groups. They may not necessarily share the same visions and goals, yet the country depends on them quickly finding common ground so that increasingly serious challenges can be resolutely confronted.
Political transitions are never easy and Xi's not having a direct hand in choosing those with whom he will work makes his job harder. A decade-old system of collective leadership governing through consensus will help, as should the Standing Committee's smaller size, but hard choices lie ahead that will require an enlightened guiding hand. China is at a crossroads, a juncture that needs more than the model of economic growth that served so well under outgoing President Hu Jintao and his predecessors to smoothly negotiate. If the nation is to move confidently forward, there has to also be major economic and political reforms. The party's goal has always been economic growth and stability and that will continue. But despite years of double-digit GDP growth, there is widespread discontent. With breakneck development has come corruption, environmental degradation and vast inequality of wealth.
Power to govern
Officials, from the province to township level, have won rewards legitimately and otherwise through capital-intensive infrastructure projects that have created short-term GDP growth and employment. Xi yesterday followed his predecessors in warning of the threat of corruption, which can be properly tackled only with wide-ranging reforms. That means opening the political system to competition, oversight and rule of law. If the nation is to move forward, changes have to be detailed and timetables put in place. People have to have power to govern themselves, a judiciary that can answer their grievances and a media that is able to ensure transparency.
No new prospects for change have been offered by the just-ended congress. They remain enigmatic - the subject of an ideological and philosophical divide in the party. Officials and economists have long conceded the need for reforms to put the economy on a sustainable growth path. These calls have gone unheeded by the party, with the state sector growing ever more powerful at the expense of the private sector.
In his keynote speech at the congress, Hu pledged that China would consolidate and develop public ownership, a signal that state-owned enterprises will continue to dominate. Alongside graft, however, rebalancing the economy remains a major challenge. The country must reduce its dependence on exports and state investment and focus more on domestic consumption. There is a need for a more positive commitment to stimulate the private economy.
Break with the past
On the face of it, the make-up of the Politburo Standing Committee neither encourages expectation of change nor rules it out. After all, reforms advanced by leaders with mainstream ideological credentials could meet with less resistance than if they were promoted by liberals. If Xi is to truly move China forward, he needs to break with the past.
Most of the new Standing Committee's members are familiar with Hong Kong. Not before has the top leadership had such good understanding of our city. With Xi continuing to have oversight after taking over as president in March, top-level focus is assured. This bodes well for progress and development.
Tough decisions lie ahead on foreign policy. Moderate language and care have to prevail. The belligerence over islands in the South and East China seas that marked the lead-up to the congress was mostly about the factional plays for power, a show that China is not weak. That has prompted concern about how assertive Xi will be on international affairs. Too much is at stake to allow territorial disputes to harm ties. Sino-US and Japanese relations are fraught with problems and risks. China depends as much economically on the world's biggest and third-biggest economies as they need Chinese trade and investment. Fence-mending and co-operation have to be priorities.
There are no simple solutions to the challenges China faces. Courage is needed if its leaders are to take them on. Xi is surely aware of the need for sectoral reform of the economy and how it will only come about with a political shift. Resistance abounds in the party to such changes, but if the nation is to move resolutely towards the next stage of its development, the new leadership has to pull together and make them happen.