Friday, 17 May, 2024
By: Lakshita Bhagat
China has successfully grown economically over the years, and its GDP (in USD) has more than doubled between 2012 and 2022.
Xi getting a straight third term is of extreme significance for the country’s political and economic character
The Chinese Communist Party (CCP) is having its 20th National Congress in Beijing starting on 16 October. History is waiting to be made with Chinese Premier Xi Jinping all set to get a third term in a row to become the President of the country and general secretary of the CCP. These changes will eventually be sealed in the first quarter of 2023 during the National People’s Congress. The anticipated events will be a watershed moment as they will define the path China will tread and immensely influence international political and economic relations.
Xi getting a straight third term is of extreme significance for the country’s political and economic character as well as for the entire world as it carries huge implications for international relations, trade, and geopolitics. The change at the home front will effectively undo the past legacy of Deng of not having more than two five-year terms as general secretary. This has led to the drawing of comparisons between Xi and Mao due to their centralisation of power. The world is keenly watching the step the country will take regarding its foreign policy, Covid measures, military, employment and trade policies.
Amidst the imminent heavy resetting in China, let us look at how the country has performed on several key indicators in the last decade and assess its journey forward.
China has successfully grown economically over the years, and its GDP (in USD) has more than doubled between 2012 and 2022. The rise of China has been so spectacular that it is now the second largest economy after the United States with a share of 18.45% of the world economy. Another front on which China has performed remarkably is the reduction in extreme poverty, which according to experts, carry lessons for many developing nations. As per the UNDP Human Development Index, the rank of China is 79 out of more than 190 countries with an HDI value of 0.768, making China a high-performing country.
Integral to China’s economic success and rise as a formidable global power are exports and the military. As can be seen from the table above, the export of goods and services increased from USD 2.18 trillion in 2012 to USD 3.55 trillion in 2022. Spending on the military has successively increased between 2012 and 2021.
However, China’s GDP growth forecast for 2022 and 2023 has been lowered given the strict zero Covid-19 policy, Covid-induced lockdowns, property crisis and ongoing geopolitics dynamics. The IMF has underlined recession in major global economies including China, which is going to impact the world at large as China plays a major role in global supply chains. On the other hand, while military expenditure has increased over the years, according to the World Bank, it has remained within the range of 1.7-1.8% as a share of GDP.
Against this backdrop, let us see how Xi while firmly cementing his role in the country for foreseeable future tackles the challenges thrown up by Covid-19 containment measures, plummeting current account balance, impeding recession, and handling the relationship with India and the US. As apparently, this is what he is seeking more time for— to reform the economy and military.
Finally, with Xi set to remain in power for the rest of his life, analysts have highlighted how this will push China towards a more totalitarian and authoritarian regime, showing parallels between Xi and Mao, who ruled in the 1970s. There are fears of a further crackdown on dissent and influential companies, as happened with Jack Ma of Alibaba. Further, the CCP National Congress could witness the insertion of ‘Xi Jinping thought on Socialism with Chinese Characteristics for a New Era’, which was unveiled in 2018, in the annals of the state constitution. Xi has effectively consolidated his control within the party and exercises enormous powers. The President’s plan to make China a global leader by the mid of 21st century would be severely tested given the massive economic challenges, Covid-19 containment strategy, tussle with Taiwan, ageing population and contracting workforce, geopolitical happenings, and the cautious US.
