China Leadership Monitor
Friday, May 8, 2009

Spring 2009: Issue 28

PRC-Tawain-United States
PRC-Tawain-United States

First the Easy, Now the Hard

by Alan D. Rombergvia China Leadership Monitor
Friday, May 8, 2009

PRC President Hu Jintao’s speech on cross-Strait relations last December laid out a major initiative for a comprehensive economic agreement, political dialogue and accommodation to Taiwan’s aspiration for “international space,” and dialogue to consider a mechanism to enhance mutual military trust that he presented as adaptations to positive changes in Taiwan since last year’s elections and as a “new starting point in history.” Debates followed Hu’s proposal, both on Taiwan and on the Mainland, that centered not only on the “what” and “how” of the six points, but also on the pace at which progress might be made. On the Mainland, some of the impatience seems to come from those who assume that whatever is left undone when Hu steps down after finishing his second term in 2012/2013 will languish for a considerable period of time as the next leader establishes his position and sets his priorities. And they fear that this “delay” will last at least through most of the successor’s first five-year term, leaving a policy vacuum in which political developments in Taiwan could bring new challenges.

In Taiwan, the principal expressions of impatience seem to be coming from President Ma himself. In addition, although the general level of public support for Ma’s approach to cross-Strait relations remains high, the concerns expressed by the DPP go across the board to include sovereignty, economic dependence, and even basic identity. In any case, if progress is to be accelerated even on economic cooperation, it would appear that authorities on both sides have some work to do to allay concerns and generate support for the quicker pace.

Military Affairs
Military Affairs

Hu Jintao and the “Core Values of Military Personnel”

by James Mulvenonvia China Leadership Monitor
Friday, May 8, 2009

In late 2008, CMC Chairman Hu Jintao introduced the concept of “the core values of military personnel,” extending his previous concept of the “socialist core values system” to the People’s Liberation Army. The resulting political campaign centered on the implementation of a 20-character phrase: “being loyal to the party, deeply cherishing the people, serving the country, showing devotion to missions, and upholding honor.” This article examines the origins, content, and dissemination of this political campaign, assessing its implications for party-army relations.

Political Reform
Political Reform

Social Order in the Wake of Economic Crisis

by Joseph Fewsmithvia China Leadership Monitor
Friday, May 8, 2009

With the onset of the world economic crisis, China’s export industries have been hard hit, with the result that millions of “peasant workers” have returned to their inland homes. Although these returnees present a potential social order problem, especially if the economy does not rebound in the latter half of 2009, most of the social order problems witnessed in recent months appear to be a continuation of the deterioration in local governance in various parts of the country in recent years. Thus, the return of migrant workers to the countryside is not so much a problem in and of itself as it is an additional burden on an already fragile political economy.

Economic Policy
Economic Policy

Understanding the Chinese Stimulus Package

by Barry Naughtonvia China Leadership Monitor
Friday, May 8, 2009

Shocked by the speed and depth of the economic downturn in 2008, the Chinese government responded vigorously with a very large stimulus package. The Chinese leadership has continued to modify the program, adding initiatives and layers of complexity, while sticking to the original headline numbers. The overall stimulus program can be broken down into three interrelated components: an investment plan, a set of funding mechanisms, and a series of industrial policies. Together, these initiatives make up a large, activist intervention in the Chinese economy that will shape the trajectory of Chinese development for a decade or more.

Party Affairs
Party Affairs

Leadership Presses Party Unity in Time of Economic Stress

by Alice L. Millervia China Leadership Monitor
Friday, May 8, 2009

Prominently publicized criticism sessions of the Party’s supreme political and military decision-making bodies in January capped a six-month study campaign to enforce Party discipline at national and provincial levels behind the policies of the collective leadership around General Secretary Hu Jintao. The campaign was launched in September 2008 to re-study the “scientific development concept,” which had been endorsed at the 17th Party Congress as a key element in the Party’s overarching ideological framework. As China’s economic growth sagged under the impact of the world financial downturn, however, the campaign subsequently shifted focus to stress the priority of Party unity behind the Hu leadership, apparently in an effort to squelch intra-Party debate and splits as tensions in China’s society sharpened from the economic crisis.

The Provinces
The Provinces

Reclaiming the “Head of the Dragon”: Shanghai as China’s Center for International Finance and Shipping

by Cheng Livia China Leadership Monitor
Friday, May 8, 2009

Throughout the 1990s, China’s official media referred to Shanghai as the “head of the dragon.” The metaphor symbolized Shanghai’s pivotal role in leading the Yangtze River Delta, the Yangtze River basin, and more broadly, China, into the 21st century through rapid economic growth and dynamic integration into the global economy. This official expression, however, has become less commonly used ever since Jiang Zemin, who advanced his career primarily in Shanghai, retired from his post as secretary-general of the Chinese Communist Party in 2002. Since then, a more balanced regional development strategy, favored by Hu Jintao and Wen Jiabao, has placed other major cities, especially Chongqing and Tianjin, on the fast track of economic development. Both the central government’s macroeconomic control policy for most of this decade and the purge of former Shanghai Party chief Chen Liangyu in 2006 seemed to undermine Shanghai’s predominance in the nation’s economic and political arenas. In March 2009, in the wake of the ongoing global financial crisis, the Chinese central government took another drastic turn and endorsed a blueprint to designate Shanghai as a “global financial and shipping center by 2020.” Once again, Shanghai has had a set of favorable policies bestowed upon it by those in power. This essay examines the economic motivations, policy initiatives, political backgrounds, and international implications of this new phase of development for China’s pace-setting metropolis.