Q&A: What You Should Know About China's 19th Communist Party Congress
China’s 19th Communist Party Congress is fast approaching. While the meetings are primarily a political event, they will shed some light on the party’s broad economic goals. There will also be major reshuffling across party leadership this year. Read below for our synopsis and predictions:
Q: What is China’s Communist Party Congress?
A: The constitution of the Communist Party of China (CPC) requires a Congress to be held once every five years. At the meeting, which commences October 18 this year, top party leaders are appointed, broad policy priorities are announced and it is a chance to revise the party constitution.
Q: Why is this year’s Party Congress important?
A: If the CPC sticks to age limit rules for its members, this year’s congress will experience a big reshuffle. At least 11 of 25 Politburo members, including 5 out of 7 members of the Politburo Standing Committee (China’s top leadership body), are due to retire.
These retirements are significant as they signal an end of “the third generation leadership,” or the Jiang Zemin era. Jiang Zemin, president of China from 1993 to 2003, was regarded as extremely strong; his influence persisted beyond his retirement. Jiang actually selected Xi Jingping as the successor to President Hu Jintao. But Xi consolidated power very quickly in his first term, with great efforts to rid the party of Jiang’s influence. The reshuffle this year will see the very last of Jiang’s generation retire.
Q: What’s to (and not to) expect?
A: Keeping in mind that key roles won’t be revealed until March 2018, we can expect President Xi to deliver a lengthy speech, similar to the US State of the Union address. The speech will summarize the past five years and outline broad policy priorities for the next five. The Party Congress is more of a political event than anything else, so the most we should expect are hints on key policy direction and details.
Q: What will the key economic focus be in the political report?
A: Details on economic policy likely won’t be available until the Central Economic Work conference in November or December. However, market participants will pay attention for any indication of new reforms.