Three major transitions visible as China’s leaders meet
As the National People’s Congress, the People’s Republic of China’s stand-in for a directly elected legislature, opened this week, it has become increasingly clear that China’s economy, polity and foreign stance are all going through a major transition. These transitions coincide with, but are probably largely unrelated to, the inter-generational transfer of power from the “fourth generation” of Chinese leaders to the “fifth generation”, a handover that is being managed to be as stable and continuous as possible. In terms of the economy, it is clear that China’s leaders have accepted that growth is slowing. For the first time in years, the country has set a growth target below eight per cent — which many assumed to be the very lowest bound that the ruling party would permit, necessary to preserve political stability. Wen Jiabao, China’s premier, told the Congress that growth would slow to 7.5 per cent from last year’s 9.2 per cent. Trade has grown by just 10 per cent, as opposed to over 24 per cent last year. Mr Wen, generally surmised to be of a reformist inclination, spun this news as positive. Without mentioning other possible causes – the weakness of China’s external markets, soaring labour costs, high public debt at the local level, an expanding real-estate bubble, and persistently low returns on investment – Mr Wen said instead that the deceleration was planned. It would, he said, allow China to focus on raising consumer demand and rebalancing the world economy — goals that China’s leaders have hitherto implied are unimportant.
The softening of China’s economy is not accompanied, however, by a softening of its external aggrandisement. China’s defence budget has expanded by 11.2 per cent to $106 billion, though many observers believe that this greatly understates the total amount China spends on security. China’s global profile has risen and its relations with its neighbours have worsened. It remains to be seen whether this expansion in official spending – which has caused brows to furrow all over the world – is part of a sustained scale-up to challenge the US’ new focus on Asia Pacific.
Yet what the entire world is fixated on is not quite what the focus within China is. There, the big idea of this session of the Congress is overdue reform of China’s criminal law. In a major revision of the criminal procedure law, some legal constraints are being introduced on China’s all-powerful security services. These, such as the introduction of pre-trial hearings, plea bargaining and stricter control on what counts as admissible evidence, may still be honoured more in the breach than in the observance. Yet the process by which the law is being drafted marks another major change. Consider one draconian provision, in which the police can detain a citizen for six months without trial or notification. It is now being reported that after an outcry online, the requirement to inform a detainee’s family might well be introduced. If so, this – like Mr Wen’s insistence that growth will be slowed down in order to make it more inclusive – may mark a major transition away from what observers generally expect from China’s leaders.