Can China stand the pace of reform?

By Jonathan Fenby

 

When the prime minister of China warns that without political and economic reform his country risks losing the gains it has made in the past three decades, one might feel justified in concluding that the last major state on earth ruled by a Communist party has reached a watershed. The remarks by Premier Wen Jiabao this week, at the close of the annual meeting of the country’s legislature, the National People’s Congress, are not those of a lone voice. They fall into a pattern of calls for reform that have been increasingly heard in China this year as the Communist Party prepares for its five-yearly congress, probably to be held in October.

 

They also came two days before the fall of Bo Xilai, the rock star of Chinese politics, as boss of the mega-municipality of Chongqing with its 32 million inhabitants. Bo had been caught up in a dramatic scandal following the apparent attempt by his former police chief and close associate to defect to the United States. The affair remains extremely murky, but it seems that the way in which it spread like wildfire on websites and social media made it simply too awkward for a leadership which operates in a highly buttoned-up style.

 

Bo’s removal from the post of Communist Party Secretary of Chongqing, announced yesterday, pleased reformers who saw him as representing an old-school approach, stretching from his command economy policies to his promotion of old patriotic values. He belongs to the “princelings”, offspring of first-generation Communist leaders. The principal member of this group, Vice President Xi Jinping, who will take over the leadership of China later this year, did not intervene to save a figure who had become too much of a tall poppy in a highly conformist regime.

 

That can only boost Bo’s main public opponent, Wang Yang, the Party Secretary of the country’s richest province, Guangdong, across from Hong Kong. Wang has been talking of the need for change as he aims to be promoted to the country’s top decision-making body, the Standing Committee of the Party Politburo.

 

This was followed by an online commentary from the main Communist Party newspaper, People’s Daily, under the headline, “We’d rather have imperfect reforms than crises brought by no reform”. Academics pitched in, and I found myself drawn in after my British publisher sent an advance copy of my new book on China to the state-run English language newspaper, China Daily. I had not expected my often critical analysis to find favour; on the contrary, the paper asked me to write a comment page article on the need for economic reform, which it ran without a word altered.

 

Then Wen capped the reformist surge by declaring on Wednesday that “we must press ahead with both economic structural reform and political structural reform, in particular reform in the leadership system of our party and country”. Otherwise, he warned, “the gains we have made in this area will be lost, new problems that have cropped up in China’s society will not be fundamentally resolved and such a historic tragedy as the Cultural Revolution may happen again”. Those last words were taken as a slap at Bo and his campaign to get residents of Chongqing to sing Mao-era “red songs”.

 

Before we conclude that China is heading for a Gorbachev-style revolution, some very significant factors have to be taken into account. To begin with, Wen and his boss, the current Party leader, Hu Jintao, will both step down during a five-month period of transition in both the Party leadership and the government, starting in October. Second, Hu and Wen have little to show in the way of change for their 10 years in power. On top of which, Wen’s status is less than it appears; he heads the government but, in China’s Leninist system, it is subservient to the Communist Party and Hu has never made any mention of reform. Indeed, the Party establishment has slapped down Wen’s pro-reform remarks in the past and the censor told the media to confine coverage of his remarks this week to a report from the state news agency, Xinhua.

 

China’s leaders know that the country should be at a turning point. It needs to rebalance its economy away from dependence on investment (above all in property and infrastructure) and boost domestic consumption. The leadership also has to deal with social tensions, an environmental crisis and shifting demographics.

 

But explosive growth has strengthened the status quo and vested interests who oppose change. This, as Wen noted on Wednesday, breeds corruption, income disparity and the yawning trust deficit when it comes to the credibility of the authorities. “Only believe something when the government denies it” is a popular catchphrase.

 

Wen, Wang and others at the top envisage reform to safeguard Party rule, not to destroy it. Just as the patriarch Deng Xiaoping introduced economic change at the end of the 1970s to strengthen both China and its ruling party, today no senior figure dares to talk of competitive democracy to enfranchise the world’s most populous nation.

 

The current debate in China is important, and is given an edge by Bo’s fall. But China has no record of peaceful political evolution. During the 2,200 years of imperial rule, dynasties fell but it was not in their nature to step down of their own accord. The same is true of their Marxist-Maoist-market heirs. So the pertinent question is whether they can cope with a changing economy and rapidly evolving society within the confines of their monopoly political system or whether they will be forced to accept reform with far-reaching potential. Given China’s position as the planet’s second biggest economy and its enormous global importance, this is a matter which concerns not just the last major state on earth ruled by a Communist party, but also the world at large.

 

Jonathan Fenby’s book on contemporary China 'Tiger Head, Snake Tails’ is published next week /Telegraph