Poverty alleviation is set to be a key theme in Xi’s report to the 19th Party Congress on 18 October. Social justice, framed in Marxism as a matter of class oppression fixed once and for all by revolution, was legitimised as a policy area by Hu Jintao at the 17th Party Congress. This was to be realised by reducing gaps in wages and salaries.
After months of preparation the 19th Party Congress, kicking off on 18 October, will set the stage for Xi’s second term. This first edition of our congress bulletin covers key narratives and trends in the run-up to the Congress. The next will focus more specifically on personnel movement, featuring our picks for the Politburo Standing Committee.
Following a 30 August risk alert from the internet finance self-regulating body (NIFA), the central bank (PBoC) announced a ban on initial coin offerings (ICOs) and cryptocoin transactions. Declaring ICOs as unapproved financing activities, the announcement demanded an immediate halt to all issue and exchange of cryptocurrencies.
Supplying affordable housing at scale remains a top challenge for first- and second-tier cities. Migrants without a local hukou face severe restrictions in home purchasing. Even the middle-class are demoralised by real estate prices soaring to hundreds of times their annual incomes.
Policies issued in the summer of 2017 signal a shift in the state’s approach. Previous reforms focused on purchasing restrictions; the new round aims to increase the housing supply, above all of rental housing, in second- and first-tier cities including Beijing, Shanghai and Guangzhou.
The critical 19th Party Congress will open on 18 October 2017, it was announced on 31 August. A Party Congress is held every five years for the formal purposes of electing a new Central Committee and Central Commission for Discipline Inspection, amending the Party constitution, and approving the general secretary’s report. Deeper functions are to reaffirm Party importance to itself and the people, and to set general governance guidelines. The all-important report will reflect Xi Jinping’s 习近平 own vision for governing China up to 2022 and beyond.
The BRICS summit eclipses all in domestic media: Pyongyang’s 3 September 2017 test was not allowed to detract from Xi’s Xiamen summit. Lack of media coverage today also indicates the leadership has yet to agree on a response. Major political capital is at stake in Xiamen: the Doklam resolution having saved China’s face, positive, win-win signals are needed from BRICS.
Beijing agreed to move from its positive to a negative list model as the basis of Sino–US trade negotiations in July 2013. Aiming to use negative lists in bilateral investment treaties (BITs), State Council started piloting the model in free trade zones (FTZs), consistent with the 2013 Third Plenum call for a ‘unified, open and fair market system’, pledging the market a ‘decisive role’. This high point in ostensibly pro-market rhetoric remains unfulfilled, but the scrapping of case-based investment approvals mooted in the Plenum is moving forward. On 16 August, State Council issued a new document, its second in 2017 accelerating the move.
China Unicom finalised its mixed-ownership plan after suspensions of stock trading and rumours about potential strategic investors. The plan has three prongs: a new share placement for strategic investors (such as Baidu, Alibaba, Tencent and JD.com); agreement-based transfer of existing shares to China SOE Structural Adjustment Fund; and an employee stock ownership program (ESOP).
Four provincial public security chiefs and seven provincial political and legal affairs secretaries have been replaced, emphasising social stability leading up to the 19th Party Congress. Political and legal affairs secretaries, powerful social controllers, can no longer hold simultaneous positions as public security chief, deputy party secretary or deputy governor. Several more central government officials fell to corruption charges, including Yang Jiacai 杨家才 former banking regulator (CBRC) assistant chairman, Wang Min 王珉 former Liaoning Party secretary and Yao Zhongmin 姚中民 former China Development Bank deputy Party secretary.
At the 17th CCP National Congress in 2007, then President Hu Jintao 胡锦涛 announced that China would become an ‘ecological civilisation’ (eco-civ). The expression was written into the Party’s constitution at the 18th Party Congress five years later as an ‘addition and improvement’ to ‘socialism with Chinese characteristics’. It also became part of the ‘five-in-one’ 五位一体 development strategy—which grew from the Deng-era cultural and economic ‘two-in-one’ to include political, social and environmental aspects.
Significant external challenges face Belt and Road (B&R), according to a report by Fu Mengzi 傅梦孜 vice president and Xu Gang 徐刚 doctoral candidate at the highly influential China Institutes of Contemporary International Relations (CICIR), a think tank with close links to Chinese intelligence services. Chinese firms need to understand local conditions, says a second report by Li Ziguo 李自国 Department for Eurasian Studies deputy director at the China Institute of International Studies (CIIS), the think tank of the Ministry of Foreign Affairs.
US trade relations are moody after Trump signed an executive memorandum authorising a probe into alleged theft of US IP by Chinese citizens and companies. Evidence collection will be protracted but the investigation will potentially impact China’s high-tech industries, including mobile phones, computers and integrated circuits, says Zhou Shijian 周世俭 Tsinghua University Sino–US Relations Research Centre.