REPEAT: China Unveils Top Leadership; Xi Consolidates Power

--No Clear-Cut Successor To Xi Named To Panel

--Li Keqiang Retains No. 2 Seat

By Vince Morkri

     BEIJING (MNI)  - China on Wednesday unveiled the new lineup of the top

leadership of the Communist Party, the Politburo Standing Committee, as chosen

by the party's Central Committee.

     The latest iteration of the Standing Committee consists of seven members,

the same number as the previous version, with President Xi Jinping at the center

and Premier Li Keqiang continuing as the second-ranking member. The five other

previous members all retired, as they were all past the traditional Standing

Committee retirement age of 68. 

     The Standing Committee is the government's de facto decision-making body

whose rulings are regarded as having the force of law. Xi has installed at least

two men who are considered hard-core loyalists, and kept Li on board for another

five years. But no clear-cut successor to Xi was named to the panel, strongly

suggesting Xi is eyeing the possibility of staying in power beyond the end of

his second term as president and head of the party in 2022.

     The new Politburo Standing Committee members: 

     -- Xi Jinping, the general secretary of the party, is the "core" of the

Standing Committee. At 64, Xi enters his second five-year term as the country's

leader. During the 19th Communist Party National Congress over the past week, Xi

had his political beliefs  -- "Xi Jinping Thought On Socialism with Chinese

Characteristics for a New Era" -- elevated into the party Constitution as a

guiding principle. In essence, it outlines Xi's vision for national rejuvenation

and China's becoming a fully modern socialist nation by the middle of the

century. The congress also enshrined into the Constitution Xi's anti-corruption

fight, his "One Belt, One Road" infrastructure investment initiative to link

China with its Asian neighbors as well as Africa and central Europe, and his

campaign to implement supply-side industrial reforms and allow market forces to

play a key role in the allocation of resources. His anti-corruption campaign

since he took power in 2012 has snared several high-level Communist Party

officials and would-be political rivals, most notably former Politburo Standing

Committee member Zhou Yongkang and Chongqing party boss Sun Zhencai, and leaving

little room for malfeasance within the party. Xi is also the head of China's

military. Xi will be formally elected president in March at the National

People's Congress.

     -- Li Keqiang, 62, China's premier and head of the State Council, is the

second-ranking member of the Standing Committee. He is in charge of leading

China's economy into the "new era," theoretically characterized by high-tech

initiatives and innovation. Although Li had seemingly lost stature as Xi

consolidated power over all government functions the past several years, he has

lately gained a higher profile at party events. Li will be expected to help

further advance Xi's mandate for supply-side reform and economic rebalancing

while keeping environmental concerns at the fore and narrowing China's wealth

gap. 

     NEW MEMBERS:

     -- Li Zhanshu, at 67 the oldest member of the Standing Committee, is

perhaps Xi's closest confidant on the new committee and is known as Xi's

right-hand man, having effectively served as his chief of staff. Li is expected

to head the National People's Congress when the current chairman, Zhang Dejiang,

retires in March. Li is the current director of the Central Committee's General

Office, which he purged members who were reticent to submit to Xi's conservative

leadership. Li is the former party head of Guizhou, where his economic reform

initiatives led to GDP growth of 49% from 2010 to 2012. Li has known Xi since

1983, when both men served as party secretaries at the county level, Li in Wuji

County and Xi in Zhending County. Li at the time called on the people of Wuji to

learn from Zhengding's, and Xi's, model of economic liberalization. Li is now

considered to be No. 3 in the party hierarchy. 

     -- Wang Huning, 62, is the head of the Central Policy Research Center. As

the party's top political theorist, he has been one of the architects of recent

government policy initiatives. Wang is considered to be the "pen" of the

Communist Party -- driving the party's sloganeering campaigns, including Xi's

"China Dream" campaign, and is also seen as one of Xi's closest confidants.

During his years as an academic in the 1980s, Wang's writings focused on

"neo-authoritarianism," a theory that political stability, and power, serve as

the foundation for economic development. He is also considered to be an expert

on U.S. affairs. Wang also advised the presidential administrations of Jiang

Zemin and Hu Jintao. 

     -- Wang Yang, 62, has been elevated to executive vice premier, from vice

premier. He was previously the party boss of both Chongqing (2005-2007) and

Guangdong (2007-2012). He is expected to help Li Keqiang run the State Council,

China's cabinet, and so take a leading role in the upgrading of the Chinese

economy, especially in the foreign trade and agricultural sectors. He has been

described as a reformist and liberal, and is credited with developing the

"Guandong Model" of development, which emphasizes entrepreneurship and a more

civil society -- in other words, being in touch with the needs of ordinary

people. He is also known for his declaration as Guangdong chief that he would

"let the enterprises which must collapse collapse." In 1992, Wang, as mayor of

Tongling, in Anhui Province, won recognition from Deng Xiaoping for his

so-called Tongling Reform.

     -- Zhao Leji, 60, head of the Central Committee's Organization Department,

which screens candidates for government-level jobs and is the government's main

corruption watchdog, is expected to become the new anti-corruption czar,

replacing Wang Qishan. Zhao was previously the party head of Qinghai and Shaanxi

provinces. Zhao's tenure in Qinghai, starting when he was appointed to the

position of governor in 1999 to when he left as party chief in 2007, was marked

by a tripling in the province's GDP. Shaanxi also experienced rapid economic

growth under Zhao starting in 2007. Zhao will be expected to strengthen and

centralize Xi's corruption crackdown. 

     -- Han Zheng, 63, the party boss of Shanghai, where he also served as mayor

from 2003-2012, will head the Chinese People's Political Consultative

Conference, the party's top political advisory body. Han was noted for his

relative openness in leading Shanghai's government, and is close to former

President Jiang Zemin, who led China's economic transformation through the

1990s. Han presided over Shanghai as it became one of the busiest container

ports in the world and a major renminbi trading and clearing center. Han is

perhaps best known, however, for the jailing of his predecessor, Chen Liangyu,

for his role in the city pension fund corruption case, where CNY3 billion was

diverted from the fund to improper investments. 

--MNI Beijing Bureau; +86 (10) 8532-5998; email: vince.morkri@marketnews.com

[TOPICS: M$A$$$,M$Q$$$,MC$$$$,MT$$$$,MGQ$$$]