Courcy’s Intelligence Brief

In our 25 January issue, we reported that China's elite is engaged in deepening struggle over reform.  The treatment of Chongqing party chief Bo Xilai, following what seems to have been an attempt on 6 February to gain asylum in the US by his right-hand man Wang Lijun, has thrown further light on the intensity of the struggle.

As we argued in our 25 January issue, a combination of unusual circumstances has been fuelling an increasingly fierce, but only partially visible, debate in China about the direction of reform.  These include the 14 January election in Taiwan, the 20th anniversary of the famous “southern tour” undertaken in 1992 by China’s late paramount leader Deng Xiaoping, and the Communist Party of China (CCP) leadership changes due this autumn.

The tone of the debate has been set by a recent report from the prestigious Tsinghua University which argued that vested interests are blocking further progress in China, which was now stuck in a “transition trap”. 

The report, which clearly set off something of an internal power struggle, was authored by Professor Sun Liping, who was at one time an advisor to Xi Jinping, currently vice-president and the heir apparent to President Hu Jintao.  The report warns, in particular, about the malign influence of vested interests which are holding back further progress.  The vested interests that are holding back reform were defined at a conference in Beijing on 8 January by Wang Yukai, a professor at the Chinese Academy of Governance, as being government officials, monopoly enterprises, resource industries, and the real estate sector.

As we reported on 25 January, the charge for renewed reform is being led by the province of Guangdong, whose provincial party chief, Wang Yang, is a protégé of President Hu Jintao.  Wang said on 4 January that reform had to focus on “breaking the constraints of the existing pattern of vested interests”.  Guangdong’s new governor Zhu Xiaodan told his first press briefing on 17 January: “The biggest obstacle to deepening the reforms is the pattern of vested interests.”

On 18 January, Premier Wen Jiabao also appeared to side with the reformers when he said in Doha on 18 January: “I have repeatedly stressed reform, not just economic reform but also political reform, because it is most important for the government to maintain close links with the people, listen to their views and voices, and improve the work of government in order to develop the economy, improve people’s livelihoods, and bring them benefits.”

But the sensitivity of the debate has been revealed once more by the Wang Lijun episode.  On 6 February, Wang – who is deputy-mayor and former police chief of the south-western municipality of Chongqing, entered the US consulate in Chengdu and spent the day there in an apparent attempt to win asylum in the US.  The timing was particularly sensitive just ahead of Vice-President Xi Jinping’s departure for a much anticipated trip to the US one week later.  So concerned were the authorities about the Wang affair that they treated it as top secret and imposed a news blackout, even if they were unable to contain internet-based discussions of the incident.

One of the more interesting aspects of the affair has been the way in which it has impacted on Bo Xilai, whose media appearances appear to have been restricted by the authorities.  According to some sources, local media were told that they needed permission from Beijing to report on Bo’s activities.  An 11 February meeting between Bo and Canada’s Prime Minister Stephen Harper was given only rudimentary coverage.

Bo is important as he is seen as one of the leaders of the leftist factions within the Communist Party, and Maoist websites such as Utopia and Maoflag refer approvingly to the “Chongqing model”.  They have also been blaming “liberal anti-communist forces” for trying to smear Wang Lijun.  A recent article on Utopia warned against undermining Bo.  It said if he was sidelined “a red movement will soon arise and completely shatter the liberal anti-communist corrupt forces”.

In the meantime, no one knows where heir apparent Xi Jinping really stands.  He was born into the CCP’s elite, being the son of a revolutionary hero, but he suffered internal exile after his father fell from grace in 1962 during the Cultural Revolution, spending seven years experiencing the extreme poverty of Liangjiahe.  It was probably his Liangjiahe experience that lay behind his 2009 outburst during a tour of Latin America when he complained about foreigners “with full bellies who have nothing better to do than try to point fingers at our country”. 

The only thing that can be said for certain about Xi is that he has the ability to appeal across the spectrum of politics.  The left will approve of his reputation for not being on the take, his Liangjiahe experience, and his uncharacteristic outburst in Latin America against meddling foreigners.  But the business community also seems reassured.

However, the danger for Xi is that he will inherit a system in which rampant factionalism will be combined with increasing popular unrest.  The fear in Beijing is that as the power-struggle intensifies ahead of the 18th Party congress this autumn, it could spill onto the streets.  According to Hong Kong sources, on 11 February there were messages circulating on the internet calling for a mass demonstration the following day in Chongqing in support of Bo.  There is no sign that any such demonstration occurred – or at least not on any great scale – but it is a warning of what may be to come and of what Xi may be set to inherit.