Oct 23 (Reuters) - China's Xi Jinping secured a precedent-breaking third leadership term on Sunday and introduced a new Politburo Standing Committee stacked with loyalists, cementing his place as the country's most powerful ruler since Mao Zedong.
Here are initial reactions from analysts and experts:
ALVIN TAN, HEAD OF ASIA FX STRATEGY, RBC CAPITAL MARKETS, SINGAPORE"
“It does look like it’s dominated by Xi’s allies.”
“In terms of policymaking, it does mean that there is likely to be more deference to Xi Jinping’s own views about how to move the country and the economy forward... I can imagine that zero-COVID policy is likely more entrenched and there’s going to be further push on this issue of common prosperity and the like.”
DREW THOMPSON, VISITING SENIOR RESEARCH FELLOW AT NATIONAL UNIVERSITY OF SINGAPORE'S LEE KUAN YEW SCHOOL OF PUBLIC POLICY:
"This is a leadership that will be focussed on achieving Xi’s political goals, rather than pursuing their own agendas for what they think is best for the country. There is only one correct way to govern, and that is Xi’s way.
"Foreign investors and businesses have desperately searched for signs that liberals or 'reformers' will play a role in shaping the economy or bringing back an old economic order that prioritised foreign investment and liberalisation of the economy. It is clear from the outcome of the 20th Party Congress that national security and the party’s political security will take precedence over economic growth."
RICHARD McGREGOR, SENIOR FELLOW FOR EAST ASIA, LOWY INSTITUTE, SYDNEY:
"The result was a resounding victory for Xi, more decisive than many experienced observers had forecast. All of his rivals, potential and real, have been forced out of the Politburo Standing Committee and Xi loyalists took their place. The new Politburo is an emphatic statement of Xi’s dominance over the party.
"I think the congress has drawn a line between the past and the future in profound ways, both for Chinese domestic politics and the way in which its influence spills out into the rest of the world.
"Xi has dispensed with the old factional system, such as it was. He has crushed expectations that he would nurture a successor. He has ignored the informal age caps on officials serving in top positions."
CHRIS MILLER, PROFESSOR AT TUFTS UNIVERSITY, MASSACHUSETTS:
“The party congress has reaffirmed Xi's decisive role in ruling the Communist Party, marking a continued shift away from collective leadership of party elites toward a personalized dictatorship. It also appears to have confirmed the downgrading of economic growth as a key party goal, relative to other agenda items such as zero-COVID and the party's political and ideological control. On tech, the key theme was self-sufficiency in science and technology, which is to be expected given the increasing decoupling of the U.S. and Chinese tech sectors.”
YANG ZHANG, ASSISTANT PROFESSOR, AMERICAN UNIVERSITY SCHOOL OF INTERNATIONAL SERVICE, WASHINGTON:
"This (Politburo Standing Committee) does not mean that Xi will become an omnipotent supreme leader and can do anything. Above all, his unlimited power will be constrained by his limited capacity and decreasing energy as he turns older. Remember Mao or Emperor Qian Long?
"Plus, Xi's full control means his team will be fully responsible for any policy mistake. His autocracy may provoke stronger international pushback from the U.S.-led Western countries. All of these scenarios will make his third and likely fourth terms not as easy as expected."
GARY NG, SENIOR ECONOMIST, ASIA PACIFIC, NATIXIS, HONG KONG:
“The new inner circle will extend and heighten the current policy stance, and generally it seems that most of the newly appointed officials seem to be Xi’s key allies. So I guess this is also a move of the further consolidation of power, or maybe in the future, of course, performance is important, but also loyalty is increasingly a key concern when picking officials.”
JA IAN CHONG, POLITICAL SCIENTIST, NATIONAL UNIVERSITY OF SINGAPORE:
"It certainly seems to be a consolidation of Xi’s position. This means that policies will be more directly attached to Xi for good or ill. I guess that translates to more focus on party-state control over business, less dependence on imports even as the PRC (People's Republic of China) seeks to export. So probably more direct party-state direction of the economy. Investment will likely seek to meet those above goals, especially if they can bring in technology. So while there may be opportunities for investors, they have to look to both market forces and political preferences more. So more of what we have already been seeing.
"Probably no lifting of COVID-zero policy in the near future, and more assertiveness in foreign and security. Even more broadly, U.S.-PRC friction will continue to grow."
DYLAN LOH, ASSISTANT PROFESSOR, NANYANG TECHNOLOGICAL UNIVERSITY:
"It's quite clear that the Politburo have been stacked with Xi loyalists and that would mean he has a much freer rein and mandate in pursuing his domestic and foreign policies as collective leadership and decision making has been de-emphasised over coalescing around Xi and implementing his decisions. It seems that he has not elevated a potential successor for now, which gives him the flexibility for a fourth term. Regarding investment, I do not think China's policies will turn sharply because of this line up, I think by and large Xi's priorities have not changed."
"Wang Huning’s presence also indicates to me that the ideological bent of the party and Xi will continue and even deepen."
PEIQIAN LIU, CHINA ECONOMIST, NATWEST MARKETS, SINGAPORE:
“It’s kind of in line and a surprise. What has been in line with expectations is really (that) President Xi is consolidating his power... And what’s been surprising is that there have been four people sort of retired from the Standing Committee – that’s more than our initial expectation of two.”
“It does look like Xi is having more say within the Politburo Standing Committee, and also with his ideology being written in the party’s charter, that’s a symbolisation of him being more strategically important within the political committee.”
REDMOND WONG, GREATER CHINA MARKET STRATEGIST, SAXO MARKETS, HONG KONG:
“General Secretary Xi has lined up a team of Politburo Standing Committee Members who closely share his vision of the future of China and the blueprint of the governance model and development strategies Xi established over the past few years...
“In the process of transforming from the labour-intensive, energy-intensive, and export-oriented development model of the past to General Secretary Xi’s new development pattern, the long-term trend growth is likely to be slower than the double-digit growth rates in the past decades. It is inevitable as transformation is necessary.
“Nonetheless, we are optimistic about China’s growth prospects in 2023... We are expecting the Chinese economy to significantly recover in six to nine month's time. That will be good news for other Asian economies, the Chinese stock markets, and the global commodities markets.”
TAKASHI KAWAKAMI, PROFESSOR, TAKUSHOKU UNIVERSITY, TOKYO:
"Xi had to keep talking about the goal of Taiwan's unification in order to strengthen his own power, and now that a new regime with a solid foothold has been established, the possibility that he will attempt to take Taiwan by force has probably receded.
"For Xi Jinping, who aims to overtake the U.S. by mid-century, his priority for the next five years is to rebuild the domestic economy. I assume he will gradually proceed with Taiwan's unification not with military force but by strengthening hybrid warfare. The same is true for Japan's Senkaku Islands (claimed by China as the Diaoyu)... Japan, as China's neighbouring country, will be required to conduct its own diplomacy toward China."
YUAN YUWEI, FUND MANAGER, WATER WISDOM ASSET MANAGEMENT, HANGZHOU, CHINA:
“The Party Congress said China would stick to reforms, and open up and support the private sector. I think it would be good for the economy if deeds match words regarding this direction. The short-term negative factor remains China's extremely harsh COVID policies, which have hit foreign investors' confidence toward China.
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