Xi Cements Control Over China, but Huge Challenges Await in Third Term – Analysis

Xi Jinping has secured near total control over China’s Communist Party but experts warn his unchecked power is a huge risk, with a debt-ridden economy and a US rivalry also presenting major challenges.

His reappointment as party leader is a watershed moment in China’s modern history, tilting decisively back towards one-man rule after decades of power-sharing among the elite.

Xi was again confirmed as party general secretary and military chief on Sunday at the conclusion of a twice-a-decade party congress in Beijing, sealing a third term at the helm of the world’s second-largest economy.

Party faithful also approved a sweeping reshuffle that stocked the top ruling body — the seven-member Politburo Standing Committee — with Xi’s allies.

The outcome capped 10 years in which Xi has accrued more power than any Chinese leader since Mao Zedong, and broke with the example set by his two predecessors who smoothly handed their authority to those next in line.
It has also sparked warnings that Xi’s increasingly unchecked power may trigger a succession crisis when his rule finally comes to an end.

“(Xi’s) reappointment today is the result of his concentration of extreme individual power,” said a senior Chinese political scholar who requested anonymity to avoid potential repercussions from the authorities.
The move was “catastrophically negative for the Chinese state”, harming the party’s resilience and heralding “decline and stagnation”, the scholar said, adding that it was “inevitable” that Xi would now seek to rule for life.

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– Economic woes –

It is the economy that is likely to command Xi’s immediate focus as he embarks on his history-making third term.
In recent years, he has thrown his weight behind the development of a more consumption-driven economy — a policy known as “dual circulation” — and has sought to address China’s yawning wealth gap under the banner of “common prosperity”.

However, his signature zero-Covid strategy, with its snap lockdowns, mass testing and curbs on movement, has pummelled consumer sentiment and chipped away at growth.

“Consumption is unlikely to recover to pre-Covid level with the current scale of Covid control,” said Dan Wang, chief economist at Hang Seng Bank China.

She said the policy has “added to the woes” in the property sector, where a debt crisis has sparked developer defaults and sown fears of a looming financial crunch for local governments.

“The government will have to choose a new model to develop the housing sector while keeping the deleveraging requirement in place,” Wang said.

China this week delayed the release of its third-quarter economic growth figures, amid expectations that the country was on course for its weakest performance since the early days of the pandemic in 2020.
The country eked out just 0.4 percent growth in the second quarter, and analysts widely expect it to miss its annual growth target of 5.5 percent by a wide margin.

– Eye on Taiwan –

More problems on Xi’s horizons include China’s relations with the West, which have cratered as Beijing has forcefully quelled huge pro-democracy protests in Hong Kong and taken an aggressive stance on Taiwan.

Xi himself has repeatedly said global geopolitics is “undergoing changes unseen in a century”, and peppered his opening address to the Congress with references to “security”.

He also reiterated that China would never renounce the option of using force to impose its rule on Taiwan, a thriving island democracy that Beijing views as part of its own territory and the US has vowed to help defend itself.

Xi’s Communist Party even enshrined its opposition to Taiwanese independence in its constitution, according to a resolution published on Saturday.

Shi Yinhong, professor of international relations at Renmin University of China, said Xi “again and again integrates unification across the (Taiwan) Strait into his cause for Chinese national greatness”.

The focus on national security in the military, economic and ideological realms “reflects the fact, as most observers in the world judge, that there is no indication of any major and lasting mitigation of relations with US and its maritime allies… in the predictable future,” he told AFP.

While Xi’s reappointment is unlikely to raise the risk of war over Taiwan, “it could be one step in a chain of events that ultimately raises the risk of armed conflict”, said Shanghai-based political risk analyst Dan Macklin.

Beijing might step up plans for reunification if slower economic growth through the mid-2020s leads the party to expand upon other sources of legitimacy, he told AFP.

But Xi’s advancing age combined with a top leadership stacked with personal allies could “raise the risk of miscalculation” — and “give Xi an extreme level of control and greater capacity to take bold moves on Taiwan“, Macklin said.

Jeffrey Wasserstrom, a leading scholar of modern Chinese history at the University of California, Irvine, said Xi’s unassailable position at the top of the party raised concerns about the “willingness of people to talk about things that diverge from the official line”.