Hiding financial data was a bad move – Victor Shih

 

Victor Shih

China’s economy is not doing as well as it used to do, but hiding the financial data during the recent Party Congress was a bad move, says financial analyst Victor Shih, author of Coalitions of the Weak,  at ANI. “The very likely reason the numbers were delayed was the State Council leaders were afraid the numbers would detract from the triumphant tone of the party congress,” he added.

ANI:

The transparency in economic figures of the country and their revelation in the form of the release of data on how the economy fared in the past three months seems to lack under the regime of Xi Jinping.

Highlighting the situation of China’s economy, a specialist in Chinese elite politics and finance at the University of California at San Diego, Victor Shih said, “It does show the primacy of politics in influencing the very competent, institutional technocracy that China has.”

“The very likely reason the numbers were delayed was the State Council leaders were afraid the numbers would detract from the triumphant tone of the party congress,” he added.

“It’s a horrible blunder. I don’t know if they are massaging the numbers. Even if they need to massage the figures, the better thing to do would be to massage them within the usual time frame,” stated Yale University law professor specialising in comparative legal and economic history, Taisu Yang in a separate statement, according to the Sydney Morning Herald.

Moreover, Beijing set a target in March that growth would be “about 5.5 per cent” this year, however, the country’s economy grew only a little more than 3 per cent in the third quarter.

More at ANI.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting? Do get in touch or fill in our speakers’ request form.

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How Xi Jinping centralized his power, and what it might mean – Victor Shih

 

Victor Shih

China analyst Victor Shih, author of Coalitions of the Weak, discusses with Bill Bishop and Cindy Yu at China Whispers on how the move from collective leadership to a centralized power might change policies in China after the 20th Communist Party Conference including the current line-up of the leadership, zero-covid and Taiwan.

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Who is who at China’s new leadership – Victor Shih

 

Victor Shih

Political analyst Victor Shih looks at China’s new leadership after what he calls a “norm-busting” meeting of the Chinese Communist Party, and who is who at the new line up, for CNN. And where are the women leaders and upcoming new top leaders?

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Li Qiang: the new man on the block – Victor Shih

 

Victor Shih

The nomination of Li Qiang as the number two of China’s Communist Party was one of few surprises at the 20th CCP conference last week, says political analyst Victor Shih at CNN. Li Qiang, Shanghai’s party chief, was responsible for the city’s much-discussed two-month corona lock-down.

CNN:

While the lineup revealed Sunday is the top tier of the Communist Party, those selected will then go on to fill top government positions, as appointments are made in the coming months ahead of a key meeting of the country’s rubber-stamp legislature in March.

The new lineup means Xi will also gain greater control over all aspects of the Chinese state, including the economy, which is traditionally the domain of the premier, who heads its State Council.

That position is now expected to be placed in the hands of Shanghai party chief Li Qiang, a long time Xi loyalist who has been appointed to the number-two role in the party, despite the backlash that followed a chaotic two-month Covid-19 lockdown in Shanghai earlier this year.

CNN:

Li’s appointment is one of several “norm-busting” elements of this year’s leadership reshuffle, according to Victor Shih, an expert on elite Chinese politics at the University of California San Diego, who noted that Li’s appointment will place a leader without any State Council experience at the head of that body — something not seen in decades.

“The Chinese economy and the State Council itself are so much more complex today compared to the 1980s. Not having that experience is going to at least initially make the job of running China’s state machinery that much more challenging,” said Shih, the author of “Coalitions of the Weak,” a book about elite politics in China over recent decades.

Meanwhile, the concentration of power “introduces a certain unhealthy dynamic in policymaking in that the people who are close to him are those who, over the years, have honed the skills of always agreeing and supporting Xi Jinping’s opinion,” he said.

Other new members include Cai, 66, party boss of Beijing and one of Xi’s most-trusted confidants; Li Xi, 66, current party chief of China’s southern economic engine Guangdong province and trusted Xi ally, who is expected to oversee the anti-corruption organization; and Ding, 60, Xi’s chief of staff and close aide.

More at CNN

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How Xi Jinping dominates China’s top leadership – Victor Shih

 

Victor Shih

At China’s top leadership, it was always possible for different political agendas to exist next to each other. But since 2012 next to Xi Jinping – up for his unprecedented third term as CCP party secretary – very few variations in leadership style have been given room, says political analyst Victor Shih at the ABC. The retirement of premier Li Keqiang finalizes Xi’s powerful position, he adds. China’s next premier is likely to be a good friend of Xi, while women and ethnic minorities make little chance.

ABC:

As soon as he came into power within the party in 2012, Xi formed and headed a whole series of groups ranging from economic reforms, to Taiwanese affairs, to national security.

That has left Li little autonomy to set his own agenda, according to Associate Professor Victor Shih, from the University of California San Diego.

“The leading groups headed by Xi Jinping have been setting the agenda to a large extent,” Professor Shih said.

“The State Council became kind of an implementation organ instead of a policy-making organ.”…

So what kind of people are more likely to join the Politburo in October?

Professor Shih, who leads the CCP Elite Database, which tracks biographical information of thousands of elite party members, said connections with Xi Jinping would be key when it comes to eligibility for the Politburo.

This could be either through families — descendants of senior communist officials — or past working relationships with Xi.

Professor Shih said while there was still a place for officials with an ordinary background like Li to join the State Council next year, key positions would most likely be held by Xi’s connections.

He also said there would be fewer leadership positions for people coming from a social science background like Li, with more politicians from engineering backgrounds having been promoted during Xi’s reign.

The CCP Elite Database also shows that all current members of Politburo are of Han ethnicity, despite China being made up of 55 other minor ethnic groups.

And China is unlikely to have a female premier any time soon.

Less than 10 per cent of officials serving in the central government are women, according to China Elite Database.

“Even in a lot of Islamic countries, [some of which] discriminate against women, you typically will see a higher ratio. And in Western democracies, it’s like 40 to 60 per cent are women,” Professor Shih said.

Currently, the most powerful female official is Sun Chunlan, who is the second vice-premier overseeing China’s COVID strategy.

She is also the only woman in the current Politburo. There are no women in the Politburo Standing Committee.

Sun had been seen on the frontline of the pandemic in Shanghai and Wuhan, the two cities that went into lockdowns during China’s coronavirus peaks in 2020 and 2022.

“She should be the number one person in the party. But in that political system, she’s not qualified,” Professor Shih said.

More at ABC.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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Defining moments in the history of the CCP – Victor Shih

 

Victor Shih (left)

Political analyst Victor Shih, author of the recently released book Coalitions of the Weak, looks – weeks ahead of the 20th Party Congress, at defining moments in the history of the Chinese Communist Party (CCP) at the Centre of Geopolitics.

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Why China’s bad-debt companies cannot bail out the country today – Victor Shih

 

Victor Shih

China has a longstanding tradition of bailing out large debtors using huge asset management companies (AMCs). But today they cannot solve the country’s real estate problems, says political and financial analyst Victor Shih to the Japan Times. “Any state injection into the AMCs could add further strain to the nation’s finances,” says Victor Shih

The Japan Times:

The savior role is one the asset management companies (AMCs) were set up to play in the wake of the Asian financial crisis as Chinese banks teetered on the brink of collapse. The biggest — China Huarong Asset Management Co. — typified the rot that later set in when it was forced to accept a 42 billion yuan ($6.1 billion) bailout last year and its chairman was executed for crimes including bribery.

The funds “can’t go on rescuing China’s property market this time,” said Victor Shih, author of “Factions and Finance in China: Elite Conflict and Inflation.” “Their own balance sheets are already so saddled with bad debt, they simply don’t have the ability to digest more.”

As recently as February regulators were looking to the AMCs as a solution to the crisis, calling on Huarong and China Cinda Asset Management Co. to help restructure weak developers, acquire stalled property projects and buy soured loans.

These same funds took trillions of yuan of bad loans off the balance sheets of the four biggest banks two decades ago. Once stability was restored, the funds, with combined assets of more than 5 trillion yuan, branched out to new sectors ranging from insurance to brokerages, and increasingly real estate…

Any state injection into the AMCs could add further strain to the nation’s finances. China’s debt to gross domestic product is already at 308%, a risky level that curbs the government’s ability to issue more stimulus, said Shih.

More at the Japan Times.

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New China hands have limited opportunities – Victor Shih

 

Victor Shih

Tense relations between China and the US, a pandemic, and limited access to the country are firmly limiting a new generation of China hands to explore a career in the second economy of the world, says China professor Victor Shih in the South China Morning Post. “China was [once] seen as a kind of land of opportunity for young foreigners. That is no longer the case,” said Shih,

The South China Morning Post:

Victor Shih, a China scholar at the University of California San Diego, said reduced economic opportunities, combined with China’s zero-Covid approach, have put foreigners off China who might otherwise be interested in the country.

“China was [once] seen as a kind of land of opportunity for young foreigners. That is no longer the case,” said Shih, who regularly visited the mainland for decades until the pandemic. He described the “golden period” for aspiring China experts as spanning the 1990s to 2017-2018 when foreign nationals with “some Chinese skills” and China knowledge had ample job opportunities in Hong Kong, Macau and mainland China.

Shih echoed the view that Beijing’s restrictive entry policies during the pandemic have made China a less attractive place to be. Indeed, a three-month mass lockdown in Shanghai from April 1 to June 1 prompted many foreigners to flee the commercial hub.

More in the South China Morning Post.

Victor Shih is 

New policies and people at the upcoming 20th Party Congress – Victor Shih

 

Victor Shih at the China Edge

Political analyst Victor Shih, author of Coalitions of the Weak, (2022), looks at the new policies and people emerging ahead of the upcoming 20th Party Congress. While party-secretary Xi Jinping will be up for a third term, Premier Li Keqiang, typically in charge of economic affairs will be replaced, he tells at the China Edge.

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Premier Li Keqiang's new leadership's style - Victor Shih

 

Victor Shih (top right)

Leading political analyst Victor Shih joins a panel at the Atlantic Council to discuss China’s top leadership, including the different style premier Li Keqiang tries to display in a situation where little deviation from the top leadership is possible. Including the leadership perspective on the Shanghai lockdown.

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China’s regulatory storms made investors uncertain – Victor Shih

 

Victor Shih

Even now the regulatory storm in the tech sector seems to be calm for the moment, but political analyst Victor Shih still expects that investors will be unsure about their future in China, as the next storm never seems far away, he tells at Bloomberg.

Victor Shih:

“After the intense regulatory actions on tech companies in the past two years, it will take quite some time for the government to rebuild its credibility. The problem is that many of the regulatory actions, such as limitation on gaming, a ban on online tutoring, and regulations on data security and privacy, likely will not be reversed. Some regulations on pricing might be relaxed, which would be bullish. The problem is investors still do not know when the next “storm” will emerge.”

“Given the high impact of government policies on production and shipping, I suspect some foreign companies will seek production elsewhere where policy uncertainties are a bit less. I still do not expect a massive exodus from China since producing in China still comes with many advantages.”

More at Bloomberg.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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Coalitions of the weak: the road from Mao to Xi – Victor Shih

 

Victor Shih

Political scientist Victor Shih discusses his upcoming book, Coalitions of the Weak, on the road from Mao Zedong to Xi Jinping, who will likely enter his third term as China’s undisputed later in 2022.

About the book:

For the first time since Mao, a Chinese leader may serve a life-time tenure. Xi Jinping may well replicate Mao’s successful strategy to maintain power. If so, what are the institutional and policy implications for China? Victor C. Shih investigates how leaders of one-party autocracies seek to dominate the elite and achieve true dictatorship, governing without fear of internal challenge or resistance to major policy changes. Through an in-depth look of late-Mao politics informed by thousands of historical documents and data analysis, Coalitions of the Weak uncovers Mao’s strategy of replacing seasoned, densely networked senior officials with either politically tainted or inexperienced officials. The book further documents how a decentralized version of this strategy led to two generations of weak leadership in the Chinese Communist Party, creating the conditions for Xi’s rapid consolidation of power after 2012.

You can watch the whole session here.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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China’s tricky relation with Russia – Victor Shih

 

Victor Shih

In the ongoing war in Ukraine, China’s biggest fear is Russia becoming a democracy, says political analyst Victor Shih at a panel of the Brown China Summit. But “rationally, I agree that China would not intervene in any way,” says Shih.

The Brown Daily Herald:

Because of its shared border with Russia, China wants to avoid the possibility of Russia democratizing, Shih said. This creates a situation where Putin “can make bigger military gambles …  knowing that financially, China’s going to come to its aid.”

“Rationally, I agree that China would not intervene in any way,” he added. “On the other hand, this (conflict) is a credible threat to China. … The situation is evolving, so I guess we’ll see.”

More at the Brown Daily Herald.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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Why Apple closed a secret US$275b deal with Chinese government – Victor Shih

 

Victor Shih

Apple’s current successful position in the China market did not come for free, disclosed the AppleInsider this week, but was triggered off by a US$ 275 billion deal between the company and the central government in 2016. Political analyst Victor Shih explains how CEO Cook dealt with governmental concerns about the US firm.

AppleInsider:

Over multiple visits, Cook is said to have lobbied officials on behalf of Apple, as well as signing the deal with a Chinese government agency. The lobbying against various threats hat would’ve affected the App Store, Apple Pay, and other products was mostly successful, if unreported at the time.

The deal was kept secret both by the company’s own culture and by the opaque workings of the Chinese government, and was politically wise according to political economist Victor Shih. It is thought that as Apple has to appease China as both a major market and a manufacturing base, it had to keep the government happy while also not appearing to other countries as appeasing China.

“Apple likely wanted to avoid the optics of groveling to the Chinese government,” said Shih.

The key deal was a 1,250-word agreement created by Apple’s government affairs, which it thought could improve its relations with the government and potentially let Apple get the ear of senior leaders. The memorandum of understanding with the National Development and Reform Commission was signed shortly after Cook announced a $1 billion investment in Didi Chuxing in May (2016).

More in the AppleInsider.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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China is closing more than only its borders – Victor Shih

 

Victor Shih

China under President Xi Jinping is profoundly changing its attitude to the outside world, much more than a pandemic-driven closure of the borders, says political analyst Victor Shih to CNN.

CNN:

And in August, a Chinese infectious disease expert was called a “traitor” who “blindly worshiped Western ideas” for suggesting China should eventually learn to coexist with Covid. Some even accused him of colluding with foreign forces to sabotage China’s pandemic response.

While it is unclear to what extent these nationalist sentiments represent mainstream opinion, they’ve been given overriding prominence in China’s government-managed public discourse, where most liberal-leaning voices have been silenced.

Victor Shih, a China expert at the University of California, San Diego, said while Xi’s predecessors had “grudgingly tolerated” Western reporters, NGO workers and sometimes even welcomed academics to China, the current administration now views their presence as sources of undesirable influences.

And Covid measures have become a convenient way to keep them out. Since the pandemic, most academics and non-profit workers have stopped going to China due to the border restrictions and quarantine requirements, Shih said.

“This heavy filter that is applied today — and had been applied prior to the pandemic — will help filter out what (Chinese leaders) see as undesirable elements from coming into China and polluting the values of the Chinese people,” Shih said.

But even after the border reopens, it remains to be seen how the Chinese government will allow foreign visitors to return — and whether some sort of additional screening might stay in place…

“Other political parties, or even maybe Xi’s predecessors, might have seen this dramatic reduction in contact between China and the rest of the world as a big problem. But for now, the Xi administration does not seem to recognize this as a problem,” University of California’s Shih said.

“(If) China wants to persuade the world that it is a benign power … it needs to engage the world.”

More at CNN.

Victor Shih is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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