Chinese Premier Li Keqiang, standing, before making his speech at the National People's Congress in Beijing. Photo: AFP / The Yomiuri Shimbun

What a (bad) difference a year makes to China! Speaking at the opening of the National People’s Congress (NPC) on Tuesday, Chinese Premier Li Keqiang admitted that China’s economy is faced with severe challenges. Such a somber admission is in stark contrast with the buoyant mood that Xi Jinping, China’s president, evoked in his closing speech of the one-party nation’s annual legislative meeting last year.

On March 5, Li, China’s second-ranking official, reminded nearly 3,000 delegates of the NPC that 2019, which marks the 70th anniversary of the founding of the People’s Republic of China (PRC), is a crucial year for the country as it endeavors to achieve the first centenary goal of building a moderately prosperous society in all respects. Such an ambitious goal was set by Xi Jinping at the Communist Party of China’s quinquennial congress in October 2017.

Yet what Li said in his Government Work Report, a state-of-the-union-style address, was not so promising. He announced a GDP growth target of 6-6.5% this year, which would be the country’s lowest rate of growth in nearly three decades.

In 1990, growth in gross domestic product plummeted to 3.9% because of international sanctions ignited by Beijing’s crackdown on the 1989 Tiananmen Square protests. In 2018, it was 6.6%, which was the slowest rate since 1990.

On Tuesday, some economists even predicted that China’s annualized economic growth could slump to 2% over the next decade.

With the economy slowing down, it is not surprising that Li painted a very gloomy prospect. “A full analysis of developments in and outside China shows that in pursuing development this year, we will face a graver and more complicated environment as well as risks and challenges, foreseeable and otherwise, that are greater in number and size,” he said.

Such a pessimistic outlook portrayed by the premier was totally absent from the president’s addresses to the CPC’s 2017 congress and the CPC-controlled NPC in March last year. In fact, in those two speeches, China’s most powerful leader since Mao Zedong depicted a very confident and powerful China, which “has stood up, grown rich, and is becoming strong,” “with an entirely new posture … now stands tall and firm in the East” as well as strides forward “at the forefront of the world.”

At those two important gatherings, Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era was enshrined in both the CPC’s charter and the PRC’s constitution. That’s why Xi also exulted “socialism with Chinese characteristics.”

“Now socialism with Chinese characteristics has entered a new era, the hard-working, brave Chinese people have shown more confidence, self-respect and self-improvement.… The path, theory, system and culture of socialism with Chinese characteristics have radiated with great vitality, while miracles keep happening in our land. We have full confidence in our future,” Xi claimed.

With such full confidence, he solemnly declared “a new era” or “another Long March,” which would see China realize its great rejuvenation, becoming “a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious and beautiful” and “a global leader in terms of composite national strength and international influence” by 2050.

In that new era, Xi asserted, China would also ‘move closer to the world’s center stage’ and ‘contribute more Chinese wisdom, Chinese solutions and Chinese strength to the world.’ That triumphant glow has now dimmed, if not disappeared entirely

In that new era, he asserted, China would also “move closer to the world’s center stage” and “contribute more Chinese wisdom, Chinese solutions and Chinese strength to the world.”

That triumphant glow has now dimmed, if not disappeared entirely.

In his report, Li identified a number of profound changes in the external environment. Chief among these is “the China-US economic and trade frictions [that] had an adverse effect on the production and business operations of some companies and on market expectations.”

By admitting that his country’s economic slowdown was caused by negative international factors and especially the trade war with the US, intentionally or not, Li contradicted Xi.

In his 2017 CPC and 2018 NPC addresses, Xi claimed that China was now strong and would be even more powerful solely thanks to its internal strengths, such as its creativity and “socialism with Chinese characteristics.” For instance, he maintained, “History has proven and will continue to prove that only socialism can save China and only by adhering to and developing socialism with Chinese characteristics will we realize the great rejuvenation of the Chinese nation.”

But such an assertion has now turned out to be false at best and counterproductive at worst.

Li Keqiang’s rare admission that the United States’ almost year-long trade war has brought ill impact on China’s economy indicates that the Asian power is not as strong as Xi Jinping touted. What’s more, it also confirms a view held by a number of Chinese and international observers, but often unrecognized by Xi, that China’s favorable international environment and notably its friendly relations with the US have significantly contributed to China’s economic success over the past four decades.

Sheng Hong, director of the Beijing-based Unirule Institute of Economics, one of the tightly controlled nation’s few independent economic think-tanks, already wrote last October that Deng Xiaoping’s 1979 reform and opening-up program, which transformed China from a poor country into an economic powerhouse, was based on two principal and related pillars, namely domestic reforms and good relations with the US.

In the same month, Zhang Weiying, another prominent Chinese economist, acknowledged that “China’s rapid growth over the past 40 years has come from marketization, entrepreneurship and technological [learning] from the West rather than the so-called ‘China model.” He also lashed out at those who used the “China model” to explain China’s economic achievement over the past 40 years, warning that such interpretation “inevitably leads to confrontation with the West.”

A recent opinion piece in the South China Morning Post also rightly observed that “a very important, and often ignored, factor” behind China’s economic success over the past decades was that it “developed in a non-hostile environment, one where the US and other Western countries supported it, and helped it grow.” But “only very recently,” it continued, “the US has begun to feel China’s rise poses a threat. Now, the Western world’s focus has changed: to monitoring China. With China on the radar, every move it makes is subject to scrutiny.”

Indeed, the US and other Western countries now see China’s rise as a threat and, consequently, seek to monitor, restrain and contain it. The key reason they have adopted such a wary and hostile posture vis-à-vis China is Beijing’s radical changes in its domestic and foreign policies in recent years, especially since late 2017 and early 2018.

At its 2018 meeting, China’s rubber-stamp legislature abolished presidential term limits, paving the way for Xi to rule the 1.3-billion-people country for an indefinite period, if not for life. Under his rule, China has become more oppressive and regressive at home while assertive and aggressive abroad. All this has engendered strong suspicion, apprehension and, consequently, pushback in the US and many other countries.

Thus though Li and other Chinese officials didn’t dare to admit it publicly, their country – or more precisely, they themselves and their “core” leader, Xi Jinping – are mostly blamed for the grim realities both at home and globally that China is currently faced with.

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