Ahead of crucial party congress, Xi faces doubts over policies

A huge red banner lining a corridor in a warehouse-like Shanghai quarantine hospital declares Chinese leader Xi Jinping’s exhortation in bold white characters: “Persistence is Victory!”

Mr. Xi’s call for persistence is now China’s watchword – not only in the battle to contain the country’s biggest COVID-19 outbreak but also across many other fronts. His overarching goal: to prevent social unrest and political doubts in the run-up to the crucial 20th Congress of the ruling Communist Party this fall, when Mr. Xi is expected to win a rare third term in power.

“Persistence means hardship, exhaustion, and holding on with gritted teeth,” said a commentary last week in the Communist Party’s main newspaper, People’s Daily.

Staying the course will be difficult, China experts say, because Mr. Xi’s bold domestic and foreign policies are controversial. His strict zero-COVID-19 strategy, his staunch support for Russia, and a recent crackdown on tech giants have broad popular support, but their economic price has nonetheless sparked intense debate among Chinese analysts, stakeholders, and the public. 

Yet analysts expect Mr. Xi will continue to double down on his policies, at least until the party congress, lest any adjustments offer ammunition to his critics. Any hint of uncertainty could complicate Mr. Xi’s plans to extend his rule as China’s most powerful leader since Mao Zedong, and to buttress it through the promotion of trusted allies.

In China’s political culture, “the reorientation of policy ... raises a lot of questions. The first question is, was that policy wrong?” says Yun Sun, director of the China program at the Stimson Center in Washington. “With his policy currently, he’s already creating a lot of complaints and ... dissatisfaction within the country, so for him to change the policy now is going to be politically even more risky than not changing it.”

More broadly, Mr. Xi has centralized power since he took charge a decade ago, making the party and government less flexible and pragmatic, experts say. Mr. Xi has strengthened the party by rooting out corruption and indiscipline, but he has also transformed it into “a top-down and single-leader dominant institution – not one that is responsive to the needs and input from other actors inside and outside the system,” says David Shambaugh, founding director of the China Policy Program in the Elliott School of International Affairs at George Washington University.

Maintaining the status quo

As the congress approaches, Chinese authorities across the country are stepping up efforts to head off any potential disruptions.

Security officials have launched a drive to eliminate social and political “risks” and ensure the “victorious hosting of the 20th Party Congress,” said Chen Yixin, secretary-general of the Central Political and Legal Affairs Commission, China’s top law enforcement body, at a meeting in April, according to the commission’s official social media account.

“Maintaining a stable domestic environment in the lead-up to the party congress is the top priority – every policy is made to ensure that goal,” says Tong Zhao, a senior fellow at the Carnegie Endowment for International Peace in Beijing.

The congress is an event held once every five years at the Great Hall of the People in Beijing to set major policies and select top leaders – including the roughly 370-strong Central Committee and 25-member Politburo. In backroom deliberations, senior party leaders select the Politburo’s Standing Committee, the pinnacle of party power.

While Mr. Xi’s securing of a third term is virtually guaranteed, the success of those he will seek to promote is less so.

“The ... probable outcome is that Xi is appointed ... but maybe he will not get up around him all the folks that he wants,” constraining his power in a third term, said Kevin Rudd, president of the Asia Society and the former prime minister of Australia, at a recent online talk at the Chicago Council on Global Affairs.

One indicator of Mr. Xi’s strength will be what happens to his protégé Li Qiang, Shanghai’s Communist Party leader. Although he was once tipped for the Standing Committee, Mr. Li’s unpopularity over his management of a punishing lockdown in Shanghai might prompt Mr. Xi to jettison him in order to salvage his own credibility, Dr. Sun suggests.

Lockdown woes

This month, Mr. Xi presided over a meeting of the Politburo Standing Committee that issued a stern warning over any wavering from China’s zero-COVID-19 policy, indicating concerns about dissenting views. The group pledged to “resolutely struggle against all words and deeds that distort, doubt and deny our epidemic prevention policies,” according to official press accounts. 

Pro-government commentators, epidemiologists, business executives, and many ordinary people have questioned the zero-COVID-19 strategy and its mounting economic and social costs.

“The Shanghai lockdown ... indicates the limits in what individual Chinese citizens can tolerate in terms of a COVID policy,” says Jennifer Hsu, research fellow in the Public Opinion and Foreign Policy Program at the Lowy Institute in Australia. “We can definitely see people’s patience for that kind of extreme policy measure reaching almost a breaking point. When it starts to affect people’s livelihoods, people’s ability to source and acquire goods for basic survival, the state has to take note of that.”

Yet, she says, “any backtracking by Xi would be particularly fraught ... because he has invested so much of his personal capital into that policy which he has deemed for saving lives.” 

China has so far succeeded in keeping COVID-19 cases and deaths extremely low by global standards. Mr. Xi and the party have argued that any loosening of the policy could risk causing an overwhelmed medical system and large-scale illness and fatalities, especially among the 50 million people in China over the age of 60 who are not yet fully vaccinated.

Seeking to prevent instability, Mr. Xi will not deviate from the zero-COVID-19 approach and instead will “do all things to maintain the status quo – he will not challenge himself,” says Alfred Wu, associate professor in the Lee Kuan Yew School of Public Policy at the National University of Singapore. “He will take a 100% sure approach in terms of his third term.”

Russia concerns

Beijing’s staunch backing for Russia and Moscow’s position on Ukraine has also generated debate within China – yet again, the consensus among experts is that Mr. Xi will persevere with the strategy. 

China’s public is generally supportive of Russia, reflecting in part the pro-Russia stance in official media and the distribution of Russian state broadcasts here. Yet privately, among policy experts and some ordinary people, debates have been intense, experts say.

“It’s one of the most divisive issues in recent years that really set different groups of people arguing fiercely against each other, including in the expert community,” says Dr. Zhao.

“Many experts are against this war. They blame Russia for the invasion, and they don’t want China to be seen as part of this block that supports Russia,” he says. Another concern is that China will be “entrapped” and its interests and international reputation potentially compromised by future actions of Russian leader Vladimir Putin, he says.

One prominent expert, Hu Wei, vice chairman of the Public Policy Research Center of the Counselor’s Office of the State Council, published an article in early March urging Beijing to change course. “To demonstrate China’s role as a responsible major power, China not only cannot stand with Putin, but also should take concrete actions to prevent Putin’s possible adventures,” he wrote, in what experts called an open bid to influence official policy.

China’s alignment with Russia, intended as a strategic counterweight to the United States, was advanced in a Feb. 4 joint declaration stating that the friendship between the two countries had “no limits.” Mr. Xi’s “personal inclination to forge this very strong and close strategic partnership with Russia has been one of the main drivers of the bilateral relationship,” Dr. Zhao says.

Beijing has reaffirmed that it will stick to this policy, despite its potential to damage long-term relations with Europe and the U.S., he says. Still, in the context of the upcoming 20th Party Congress, “the war is not good news for China,” Dr. Zhao adds. “It has all sorts of implications that could perhaps destabilize the domestic situation and could cause unprecedented economic ... shock waves.”

Economic toll

The promise of rising economic prosperity remains the bedrock of party legitimacy, yet China has now fallen into its worst slowdown since early 2020, according to the latest economic data released Monday by the National Bureau of Statistics. Industrial production slumped 2.9% – and retail sales 11.1% – from a year earlier. “The increasingly grim and complex international environment and greater shock of COVID-19 pandemic at home obviously exceeded expectation,” the bureau said. “New downward pressure on the economy continued to grow.” 

China’s economic growth for this year – targeted at 5.5% – is now forecast by financial analysts to be about 4%. Already, growth had been slowly declining amid long-term challenges of an aging population, a shrinking workforce, heavy local debt, and an economic policy that favors less efficient state enterprises over the private sector. 

Earlier this year, Mr. Xi unveiled a campaign for “common prosperity” that included swift regulatory crackdowns on big tech firms, business magnates, and industries such as private tutoring and gaming. The campaign follows Mr. Xi’s successful poverty alleviation drive and is intended to boost his already strong popularity among China’s large low-income population. But the drastic, overnight regulatory moves spooked overseas investors and Chinese entrepreneurs.

“He wants to please very much the grassroots people and show he cares about income distribution,” says Dr. Wu.

Now, COVID-19 restrictions in major cities are disrupting businesses and production nationwide, drawing complaints from foreign chambers of commerce. Costs to fiscal revenue are mounting from mass testing requirements. Unemployment in 31 major cities surged to a pandemic high of 6.7% in April, leading Premier Li Keqiang to warn this month of a “grave” job market, and labor protests have also increased, according to the China Labor Bulletin.

While Mr. Xi has heralded China’s advance to become a “fully developed, rich and powerful nation” by 2049, his growth-dampening policies are making China’s economy and society less dynamic, experts say. Politically, his dominance over decision-making is limiting China’s leeway for making course corrections.

Persistence may well lead to victory in China, but how that victory is defined and by whom is another question.