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Will China Ditch Mao To Save The Party?

November 12, 2012

The challenges for the new leadership, to be finalised next week, are re-affirming the legitimacy of the party's rule by cracking down on corruption in its own ranks while further freeing up the economy to allow the private sector to flourish.
-James Gruber, founder, Asia Confidential

Over the past three decades, China's Communist Party has had a pact with its people: you give us one-party rule and we'll give allow you to get on with you lives and make money. In other words, blending authoritarian rule with market-driven economics. The problem is that the regime's legitimacy is being undermined by endemic party corruption. And ongoing economic growth is being jeopardised by government dominance in key sectors such as banking. The challenges for the new leadership, to be finalised next week, are re-affirming the legitimacy of the party's rule by cracking down on corruption in its own ranks while further freeing up the economy to allow the private sector to flourish.

 

Maintaining the status quo isn't an option. It'd jeopardise the future of the Communist Party itself. But the party has a habit of reinventing itself and I am cautiously optimistic that it'll do so again. You're likely to see China move more and more towards a Singaporean-style economic and political model.

This is over-simplying things though. To get a better perspective of the issues facing the new President, I thought it'd be useful to take a look back at the achievements and failures of the past decade's leadership. And, in something a bit different, I'll tell the story primarily in charts and pictures. It'll make for a more lighter read but I hope you find it thought-provoking nonetheless. The charts and pictures below are sourced from Bloomberg unless otherwise stated.


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