Chinese President Xi Jinping did what everyone expected. He extended his reign as leader of the country for an unprecedented third term, while promoting more of his allies to party leadership positions and pushing his rivals into retirement.
Xi, 69, was re-elected general secretary of the Communist Party on Sunday, following the Chinese National Congress which opened a week ago, confirming his status as the country’s most powerful leader since Mao Zedong. His appointment means he will firmly control the world’s second-largest economy for at least five years at a time when it finds itself increasingly on a collision course with the United States.
On Sunday, Xi said the country will “strive harder to realize the Chinese dream of national rejuvenation,” a term that largely means transforming the nation into a global powerhouse with higher living standards and comparable cutting-edge technologies. to those of the West.
He made the comments after introducing the new seven-member Politburo Standing Committee, the country’s most powerful decision-making body, to a room full of carefully selected journalists at the Great Hall of the People in Beijing.
It’s a formation that reveals Xi has surrounded himself with allies by promoting close associates such as Beijing’s top party official Cai Qi and Guangdong province’s party chief Li Xi to the Politburo. .
The rise of Shanghai Party Secretary Li Qiang is particularly noteworthy and speaks volumes about Xi’s consolidation of power. Li, who has never held a senior central government post, appeared right next to Xi before the leader addressed reporters on Sunday. Li is best known for overseeing Shanghai’s deadly month-long lockdown earlier this year, which sparked widespread public anger and raised doubts about whether he could still earn a coveted promotion.
Observers say Xi values loyalty above all else and is ready to break with the political norms of the past. For example, Chinese Premier Li Keqiang’s name did not appear on the 205-member central committee, a prerequisite for joining the Politburo, even though he is still a year away from the usual retirement age.
Li, 67, is known to have sometimes expressed opinions on the economy that contradict those of Xi. And in a rare display of drama at an otherwise highly choreographed event, Hu Jintao, Xi’s 79-year-old predecessor, was unexpectedly escorted out of yesterday’s closing session of the party congress.
Although Hu appeared reluctant to leave, the official Xinhua News Agency later reported via Twitter that Hu left for health reasons and felt much better after resting. But the event does not appear on China’s highly censored internet, with searches for Hu Jintao on the country’s Twitter equivalent, Sina Weibo, making no mention of his sudden departure.
Xi, however, reassured market watchers. He said on Sunday that China will continue to open up and resolutely deepen reforms. The country’s economy has shown resilience and great potential, and its strong fundamentals “will not change”.
Xi’s consolidation of power comes as China faces countless difficulties. This week, Beijing delayed publication third-quarter gross domestic product (GDP) data from the country, further adding to investor anxiety over an economy that has been battered by a spiraling housing crisis and Xi’s relentless anti-Covid policies. In his party congress opening speech, Xi again hailed his Covid-Zero policy as a “people’s war” that averted deaths and protected lives, though he did not acknowledge the repeated shutdowns in citywide, food shortages and lack of medical care. resulting supplies.
Shen Meng, managing director of Beijing-based investment bank Chanson & Co., said that heading into the next five-year period, executives would continue to take a rather conservative stance in leading the business. ‘economy.
“China would likely continue to suppress the disorderly expansion of the private sector economy, and state-owned economic powers would be effectively strengthened,” he said, adding that this means private companies would work at the secondary to public enterprises. .
And it is very likely that the repression of the real estate sector will continue. Xi did not mention his ‘housing is for living in, not speculation’ slogan in his opening speech, rekindling hopes among some that support for the struggling real estate sector may be on the way. . Xi had launched his campaign for more affordable housing in 2017, which sparked a wave of policies aimed at reining in soaring house prices and curbing the excessive borrowing that had become common among Chinese property developers. But a transcript of the proceedings distributed later repeated the housing slogan, signaling that there would be no respite from the chilling measures for the foreseeable future.
It is estimated that the Chinese real estate market represents up to a quarter of the country’s gross domestic product. The real estate slump combined with Covid Zero should hang out China’s GDP growth in 2022 at just 3.2%, well below Xi’s previous target of around 5.5%