2016 was the year of the American elections. 2017 will be the year of China’s, well, sort-of-elections.
In October or November 2017, China will hold its 19th Party Congress. Although it is not a general elections (the Chinese do not get to vote), at this closed-door event officials will appoint the country’s top leaders. This they will have to win by a vote from party comrades.
The Congress will be more important than previous ones. Five out of seven people who currently sit on the Politburo Standing Committee (the power centre of the Chinese Communist Party) are set to be replaced. Half of the 18-member Politburo will also be flowing on.
It is almost with certainty that President Xi Jinping and Premier Li Kequaing will remain and they will engage all their political machinery to win it. They have to.
But it wouldn’t be a walk in the park. As China grows, so does the complexity of its problems.
Environmental degradation is a problem that never goes away. The country’s wealth is founded on contract manufacturing. Poor policy and planning of these industrial activities plunged the country into a host of environmental problems such as polluted air, desertification, toxic waterways, soil erosion and of late, the smogs that are also affecting Hong Kong. All these accelerate rising health costs, shrink agricultural land because of acid rain and result in an overall lower quality of life.
Cracks are appearing on their economic bowl. Total debt of China has ballooned to somewhere around 250 per cent of GDP, up from 150 per cent following the financial crisis, with much of the capital misallocated to unneeded steel mills, uninhabited ghost cities, and unwanted white elephant infrastructure projects.
The yuan has weakened against the US dollar. Between the beginning of 2014 and the end of 2016, the Chinese currency declined 13 per cent. With the U.S. projected to strengthen further, wealthy Chinese have sought to ship money offshore.
China is an imbalanced economy. It is heavily dependent on export and in contrast, has a relatively low share of GDP from domestic consumption compared to most developed nations. The country sells more than it buys with certain major trading partners and this has resulted in tension in bilateral relations.
Regional and maritime conflicts plague China and her neighbours. Those sharing land and sea borders with her have seen tensions escalating to dangerous points. The South China Sea disputes took much of the attention in 2016. It is agreed in the UN Convention on the Law of the Sea that 12 miles limit is a country’s strategic limit, and the 200-mile limit defines the area of economic control. China appears to be pushing their strategic limit to 200 miles in the South China Sea, only to be disputed by several claiming states.
“Tributary states” are very much a part of Chinese history. In the imperial Chinese tributary system, a China-centered order shaped the cultural and economic landscapes of Asia. In the Qing dynasty, countries wanting to trade with China had to send “tribute” missions that acknowedged China’s cultural superiority by the ritual of ke-tou (or kow-tow) which involved three kneelings and three prostrations before the emperor. In return they get trading rights and diplomatic gifts.
China’s flexing of military muscle appear to be sending a signal of dominance. Its building of ports, railways and various infrastructure in various South East Asian and African countries in exchange for trading rights appear to be normal trade investments until one considers that the target nation doesn’t really have a choice but to accept or face a diplomatic row.
Xi will also have social problems to contend with.
There is growing youth unemployment – usually a signal of greater economical problems. China now produces about 6 million graduates per year, and this may be more than it needs. Students that go without a job for a long time have historically resulted in instability. They are a potential source of social conflict because they are articulate and have the time to do something about their situation. Today, the country is able to keep troublesome dissents from erupting by tightly controlled media and internet. However, when the number of voices cross the tipping point, the situation could turn ugly indeed.
The country also has no social safety net. Worse, very few people in this current generation can remember a time where China had no strong economic growth and full employment. China has yet to face an ugly recession but with an energy crisis on hand and a new President of the United States threatening to bring manufacturing jobs home – Xi faces uncertain times. The country has no welfare system, weak private medical funding, an undeveloped insurance system and various social security policies lacking, it would be curious to see how Chinese citizens will cope when the economy faces major dips and corrections.
Yes – these are but some of the problems that China faces. But they won’t be talking about these issues anytime soon. To win an election, its candidates need to put up a strong front and convince the voting community that its leadership is fearsome enough and deserving of power.
Every stunt that China would be pulling this year would largely be in advance of these interests.