SUN WUKONG Jitters for Hu before China's big party
By Wu Zhong, China Editor
HONG KONG - China, already a growing voice on the global stage due to its
thriving economy, will hold the world's attention for a quite different reason
later this year when it plays host to the Summer Olympic Games. As visitors
throng the capital Beijing and no doubt marvel at the ''Bird's Nest'' stadium
that will house most of the big events, they will be less aware of other events
in 2008 that will be arguably more important for the country's future.
After March, new faces will be running the country's institutions, themselves
set for a thorough shake-up, while 2008 will culminate
in the 30th anniversary of the economic reforms that have created divisions in
the country while also transforming it.
According to Chinese numerology "8" means "fortune", and the country's
leadership will be hoping good luck flows their way over the next 12 months,
starting in March with the first session of the latest five-year-term of the
National People's Congress (NPC), whose agenda includes endorsement of a
restructuring of the State Council, China’s cabinet.
After the Olympics in August - the first time a Chinese city has hosted the
games - the third big event of the year will be celebrations of the economic
reforms initiated in late 1978 by late paramount leader Deng Xiaoping, whose
policy of opening up China has fundamentally changed the country, leading to
its present high economic growth and hugely increased prosperity.
A new five-year-term meanwhile will start for the ceremonial State Central
Military Commission. Its composition is identical with the Communist Party’s
Central Military Commission, but according to the constitution, only the party
commission has the real power to command the armed forces. The present party
Central Military Commission was endorsed by the 17th Party Congress last
The formation of the new State Council must be endorsed or rubber-stamped by
the NPC, which will begin its session on March 5. Attention is being paid to
the upcoming reshuffle, though no big suprises are expected, as Wen Jiabao will
remain premier and Hui Liangyu will start his second term as vice premier. Li
Keqiang, who was elected as one the nine members of the Politburo Standing
Committee at the 17th Party Congress, is widely tipped to be executive vice
premier, replacing the late Huang Ju. Two Politburo members, Zhang Dejiang and
Wang Qishan, who were recently relieved as Guangdong party chief and Beijing
mayor, are likely to become vice premiers, replacing Wu Yi and Zeng Peiyan,
both of whom are set to retire due to their age.
What is "extraordinary" this year is that the State Council will undertake a
major restructuring to cope with the changed situation in the country, with
some ministries to be wound down and some new mega-ministries established. It
is reported that Li Keqiang is working on the restructuring.
According to what has been revealed so far, plans under consideration include
setting up an energy ministry to take over all or the relevant functions at
present exercised by the National Development and Reform Commission, the
State-owned Assets Supervision and Administration Commission (SASAC), the
Ministry of Land and Resources, the Ministry of Water Resources, the State
Electricity Regulatory Commission. The Ministry of Energy will thus become
China's top regular on energy industries.
A transport ministry will also be set up, taking over and merging the functions
of the current Ministry of Communications, Ministry of Railway and General
Administration of Civil Aviation of China (CAAC). The new ministry will also
take over some functions from other departments such as China Post.
The present Ministry of Agriculture, State Grain Administration and State
Forestry Administration will be merged into a ministry of agriculture. The
current State Environment Protection Administration (SEPA) and Ministry of
Construction are likely to be merged into a ministry of environment and
construction, which will also take over some of the functions currently
exercised by other departments such as the Ministry of Land and Resources and
the National Development and Reform Commission.
Changes in the regulation of the financial industry are also underway, with the
government easing restrictions that prohibit China's banking, securities and
insurance companies from doing business in each other's sectors. The proposed
changes will allow so-called "cross-sector" businesses. To facilitate
supervision under the new circumstances, China is considering merging the
separate regulators - China Banking Regulatory Commission, China Securities
Regulatory Commission and China Insurance Regulatory Commission - into a super
financial regulatory body. Another alternative is to set up an ad hoc group to
co-ordinate cross-sector supervision. Former central bank governor Dai
Xianglong, who has just been relieved as Tianjin mayor, is tipped to lead the
A major reshuffle of officials is inevitable under the various ministry
chantes, as central government departments are closed or streamlined.
Pleasing believers in numerology if no one else, Beijing is set to kick off the
2008 Olympic Games on August 8 (08-08-08). Success of the games will be a
matter of more than national pride. The 17th Party Congress last October marked
the final stage of President Hu Jintao's emergence from the shadow of his
predecessor, Jiang Zemin, and a successful Olympics will serve a proof of the
capabilites of the fourth-generation Communist Party under Hu's leadership.
If something goes wrong, the Chinese leadership would not only lose face but be
seen by the general public as responsible. Officials at all levels are now
being mobilized to ensure the success of the Beijing Olympics, with no
The games come as the country's place on the global economic stage is no longer
in doubt, clear proof of the progress made after 30 years of economic reforms
and opening up to the wider world. The Cultural Revolution launched by Mao
Zedong in 1966, which brought the Chinese economy to the edge of bankruptcy,
came to an end with the death of the Great Helmsman and one year later, Deng
Xiaoping was rehabilitated to make the third political comeback in his
The 11th Central Committee of the Communist Party held its third plenary
session on December 18-22, 1978 and Deng, though nominally not the No 1 leader,
dominated the meeting. Steered by him, the party's policy-making body decided
to discard Mao's "class struggle" doctrine and shift its focus onto developing
the country's economy. To do this, the then command economy had to be reformed.
To facilitate reform, it was also decided to open doors to foreign investors.
The subsequent transformation of the country continues to astound the world.
In 1978, the country's gross domestic product (GDP) or its equivalent (because
it had not then adopted the term) was 568.9 billion yuan (US$78 billion). In
2007, GDP is estimated to have grown 40 times to 23.25 trillion yuan. China's
foreign reserves, basically zero in 1978, now total more than $1.4 trillion.
The country's people in general have never felt so prosperous. As a Chinese
saying today puts it: "Mao Zedong led us to stand up while Deng Xiaoping led us
to become rich."
Numerous activities are therefore expected to mark the anniversary of Deng's
opening up of the country. At the same time, amid the justified celebrations,
the government will be seeking to address problems the economic reforms have
brought in their wake, notably a widening wealth gap, the deteriorating
environment and rampant official corruption. Failure to address these problems
will lead to heightened questioning by neo-leftists, a small group of young
intellectuals mainly based in Beijing and who claim themselves true Marxist
They argue that the reforms have betrayed socialism and changed China into a
capitalist country, resulting in its increasingly widening wealth gap. They
have made their case through various media, with their views echoed by some
retired officials. Their influence so far remains minimal. However, if
discontent grows among those left behind or hurt by the country's prosperity,
the voice of criticism could become louder and be more clearly heard once the
Olympic applause has faded and the foreign crowds gone home. Host Hu has a long