A senior China analyst at Eurasia Group (EG) said Xi Jinping's appointments on the newly announced Politburo Standing Committee (PSC) represent the removal of XI's potential opposition to an extreme degree.
“Who are China's new leaders? The CCP just announced its new Politburo Standing Committee The result: a clean sweep for Xi allies and a consolidation of power unseen since the Mao era,” Neal Thomas said in an Oct. 23 Tweet for EG, a political-risk consultancy group.
China's 20th National Party Congress concluded on Oct. 22 with Xi Jinping claiming a third term as party secretary and succeeding in packing the PSC with loyalists, thus removing potential opposition, the Atlantic Council (AC) reported. Xi confirmed that he is committed to China’s strict zero-Covid strategy, emphasized “security,” and highlighted his desire for “reunification” with Taiwan, AC reported.
Li Qiang, leader of the Shanghai Communist Party, is new to the Politburo Standing Committee (PSC) but was second onstage after Xi Jinping as the rest of the members of the PSC were announced, Reuters reported. That suggests that Li is poised to become Premier when Li Keqiang retires in March.
Thomas expressed surprise at Li Qiang's apparent positioning. He tweeted that Li Qiang would be the first premier since 1976 to not first serve as vice premier and said “he is inexperienced at national governance.” Li served as top secretary to Xi Jinping when Xi was Zhejiang Party Secretary in the mid-2000s.
Zhao Leji and Wang Huning both returned to the PSC after serving on it previously, Reuters reported. Newcomers to the seven-man committee are Cai Qi, Ding Xuexiang, and Li Xi.
“All of his rivals, potential and real, have been forced out of the Politburo Standing Committee and Xi loyalists took their place," Richard McGregor, senior fellow for East Asia at the Lowy Institute, said to Reuters. "The new Politburo is an emphatic statement of Xi’s dominance over the party.”
Thomas said in a Tweet that Xi's selections for the PSC broke experience, but not age norms (except for Xi). The other group within the committee is a “Xi faction.”
“The big question now is how long can Xi's dominance last?" Thomas tweeted. "This PSC helps Xi’s agenda, but costs may mount.”
One such cost could be the surge of selloffs that hit the Chinese stock market after the congress concluded. Hong Kong’s Hang Seng index dropped 6.4%, representing its steepest drop since 2008, Axios reported Oct. 25. Chinese currency plunged to the weakest level in 14 years compared to the U.S. dollar, another indicator of extensive withdrawal of capital.
With the new PSC appointments, the Axios report states, Xi might have ended China's "reform and opening" era began in 1978 to reverse the chaos of Mao Zedong's autocratic rule, and the country's attraction as a global market, by removing only "market-friendly technocrats" from the PSC.
In a note to clients, according to Axios, SGH Macro Advisors analysts wrote “What this means is that China will face a more difficult international and domestic environment in the future, and that China and Western countries led by the U.S. will face even greater conflict in the fields of geopolitics, high-tech, economy, and trade."
