What is the extent of China’s influence in Zimbabwe?

  • 20 November 2017
  • From the sectionAfrica
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General Li Zuocheng, of China, and General Constantine Guveya Chiwenga, of ZimbabweImage copyrightMND
Image captionGeneral Chiwenga was welcomed to China by military leaders

A trip to Beijing by Zimbabwe’s military chief was a “normal military exchange”, China’s foreign ministry said after the army seized power in Harare. How deep are relations between China and Zimbabwe really?

The news that General Constantino Chiwenga had visited China only a few days before the military takeover in Zimbabwe was a coincidence that did not go unnoticed.

There was also speculation after China said it was closely watching developments, but stopped short of condemning President Mugabe’s apparent removal from power.

China is Zimbabwe’s fourth largest trading partner and its largest source of investment – with stakes worth many billions of pounds in everything from agriculture to construction.

Zimbabwe is the dependent partner – with China providing the largest market for its exports and much needed support to its fragile economy.

China’s relations with Zimbabwe are deep, starting during the Rhodesian Bush War.

Robert Mugabe failed in 1979 to get Soviet backing, so turned to China, which provided his guerrilla fighters with weapons and training.

Both countries formally established diplomatic relations at Zimbabwean independence in 1980 and Robert Mugabe visited Beijing as prime minister the following year.

He has been a regular visitor since.

Zimbabwean President Robert Mugabe and Chinese President Xi JinpingImage copyrightGETTY IMAGES
Image captionZimbabwean President Robert Mugabe has met Chinese leaders a number of times

For years, Zimbabwe’s officials have tried to play off China against the West, advocating the country’s “Look East” strategy, particularly following the introduction of EU sanctions in 2002.

Indeed, a decade ago, Mr Mugabe told a packed rally at the Chinese-built national sports stadium in Harare: ‘We have turned east, where the sun rises, and given our back to the west, where the sun sets.”

China’s military engagement also deepened during Zimbabwe’s “Look East” era.

Significant purchases were made, including Hongdu JL-8 jet aircraft, JF-17 Thunder fighter aircraft, vehicles, radar and weapons.

However, following a controversy about a shipment of arms in 2008, Beijing decided to list Zimbabwe for “limited level” military trading.

Despite Zimbabwe’s efforts, the “Look East” strategy did not bring the investment flood hoped for and a decade later, in August 2015, Mr Mugabe openly asked for Western re-engagement in his “state of the nation” address.

Now, the reality is that increasingly Chinese and Western interests – particularly those of the UK – have become aligned.

Not far from each other in the outer suburbs of Harare, two of the biggest embassies in Zimbabwe are the British and the Chinese.

As other embassies scaled down or closed, Beijing’s expanded.

Whereas British diplomats were well connected with business, civil society and opposition figures, the Chinese invested in “technical support” of the party of government Zanu-PF, including state security and the presidency.

When it came to Zanu-PF politics and factionalism, Chinese diplomats were well connected and insightful and, like their Western colleagues, concerned about stability, a better investment climate and adherence to the rule of law.

President Xi Jinping visited Zimbabwe in 2015 and President Mugabe visited Beijing in January 2017.

In public, the Chinese leader said his country is willing to encourage capable companies to invest in Zimbabwe.

But in private, the message was that there would be no more loans until Zimbabwe stabilised its economy.

Military spokesman speaking on ZBC, 15 November 2017
Image captionMaj Gen Sibusiso Moyo said the military was not staging a coup

In 2016 trade between the two countries amounted to $1.1bn (£0.8bn), with China the biggest buyer of Zimbabwean tobacco and also importing cotton and various minerals.

In return Zimbabwe imported electronics, clothing and other finished products.

Chinese state construction firms have also been active, building infrastructure including Zimbabwe’s $100m (£75m) National Defence College.

And last year China agreed to finance a new 650-seat parliament in Harare.

But Chinese diplomats and many businesses are waiting for better days in Zimbabwe.

Some companies have found the investment climate challenging – being burned on diamonds, for example – and have looked for alternative markets.

A couple of weeks ago I was in China, attending a meeting on China-Africa relations and Zimbabwe was not mentioned once.

Unlike Ethiopia, Sudan, or Angola that are strategic partners, or big markets like Nigeria, Kenya and South Africa, Zimbabwe is far from being Beijing’s new priority.

So, Beijing’s interest is in a better investment climate in Zimbabwe.

A clear transitional arrangement resulting in elections for a legitimate government in Harare is as much in Beijing’s interest as London’s.

The “Look East” and the “Re-engagement with the West” strategies have not brought about the confidence and investment that Zimbabwe needs.

What Zimbabwe requires is stable and accountable government – then investors from Asia, America and Europe will seriously consider that Zimbabwe has an investment future.

This was the message that Mr Mugabe received in Beijing in January.

And the one which Zimbabwe’s military chief also was given last week.


About this piece

This analysis piece was commissioned by the BBC from an expert working for an outside organisation.

Dr Alex Vines OBE is Head of Africa Programme, Chatham House, and a Senior Lecturer at Coventry University.

Chatham House, the Royal Institute of International Affairs, describes itself as an independent policy institute helping to build a sustainably secure, prosperous and just world.


Edited by Duncan Walker

Courtesy: BBC

Opinion: Donald Trump, the illusory giant

He spewed fire from afar, but once in Beijing, he was meek. Donald Trump’s first trip to Asia highlighted one thing: the US president has very little desire to compete with China, says DW’s Thomas Latschan.

USA Donald Trump Abflug aus Peking (Reuters/J. Ernst)

It is rather unlikely that Chinese President Xi Jinping has ever read German children’s books. But if he had, he would certainly know Mr. Tur Tur, a figure from Michael Ende’s classic children’s novel “Jim Button.” Mr. Tur Tur is an illusory giant: the farther away he is, the larger and more threatening he appears. Yet the nearer he comes, the more he shrinks, until he is normal-sized and ultimately stands before the observer as an old man who scares no one.

Criticism from afar

Seen from the perspective of Chinese President Xi Jinping, Donald Trump has a lot in common with Mr. Tur Tur. The US president’s recent trip to Asia made that clear to the world. At a safe distance, be it at the APEC summit in Vietnam or the ASEAN summit in the Philippines, Trump ruthlessly attacked Chinese trade policy, railing against its “currency manipulation” and “massive intellectual property theft.” He even threatened the Chinese with economic sanctions and tariffs.

Watch video01:45

Xi Jinping hosts President Trump in Beijing

The contrast to his behavior during his state visit to Beijing could not have been greater. Once there, Donald Trump was suddenly timid, praising the Chinese president effusively and displaying his awe for Xi’s power. Trump went so far as to temporarily change the background image on his Twitter account, proudly showing himself at Xi Jinping’s side while visiting the Forbidden City and lauding the welcome ceremony that his Chinese host afforded him. Trump, the illusory giant, made himself small.

Screenshot of Donald Trump's Twitter accountOn Twitter, Trump praised Chinese President Xi Jinping, and temporarily changed the background picture on his account

So small in fact, that it seemed as if he were meekly peering beyond his own nose when US jobs seemed threatened. Under Trump, the US appears to lack any clear strategy for Asia, his plans for the “Indo-Pacific” remain fuzzy at best. Barack Obama’s “pivot to Asia,” in comparison, was aimed at embracing China’s neighbors politically and economically, thus curbing Beijing’s influence in the region. The Trans-Pacific Partnership (TPP) was an integral part of that strategy. Obama saw the trade agreement primarily as a foreign policy instrument. Donald Trump, on the other hand, saw it as a threat to US jobs and pulled out of the treaty.

True allies irritated

Japan, one of America’s staunchest Asian allies, was attacked by the US president during the trip for supposedly pursuing unfair trade practices. Leaders in Taipei, for their part, were officially nervous ahead of Trump’s Beijing visit: Taiwanese President Tsai Ing-wen implored President Trump not to even mention Taiwan during the visit for fear that its status could become a bargaining chip in Beijing and Washington’s efforts to come to a US-Chinese agreement in the North Korea conflict.

Longtime allies in the region reacted to the US president’s performance with growing consternation. China presented itself as a reliable partner, deftly attempting to fill the power vacuum being left by the USA. Geopolitically, it is expanding its network of naval bases in the South China Sea, while economically, it has been investing massively  along the new “Silk Road.” Developmentally, China is expanding the Asia Infrastructure Investment Bank (AIIB), which provides enormous credit to developing and emerging economies, while culturally, it’s overseeing rapid creation of ever more Confucius Institutes around the world.

Thomas LatschanDW’s Thomas Latschan

Unlike Trump, President Xi Jinping is pursuing a clear global political strategy. Thus, China’s rise to becoming a global power is not only being accomplished on its own, but rather it is being aided by the fact that President Trump is willingly abandoning America’s claims to leadership in Asia and around the world, opting instead for an isolationist approach – despite the fact that the USA will remain the world’s unrivaled military power into the foreseeable future.

Donald Trump entered last year’s US presidential election with the promise to “Make America Great Again.” Globally, however, he is transforming the one-time superpower into the world’s illusory giant.

Courtesy: DW

Alibaba’s Singles Day Sales Hit New Record of $25.3 Billion

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On the eve of the annual Singles Day event in China, deliverymen sorted packages in Beijing.CreditFred Dufour/Agence France-Presse — Getty Images

Singles Day — the frenzied annual celebration of consumption and commerce that is China’s much larger version of Black Friday — began as a protest of sorts against Valentine’s Day, propelled by college students in the 1990s.

The event’s date, written numerically as 11/11, was associated with unattached singles, known as “bare sticks.”

This year’s shopping festival entered new territory, blazing past $1 billion within two minutes of the holiday, starting at midnight on Saturday. By the end of the day, sales had hit a new record of $25.3 billion, more than 40 percent higher than sales on Singles Day 2016.

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At a logistics center in Nanjing, China, an employee prepared boxes to be used for express delivery. The first purchase during Singles Day this year was delivered less than 13 minutes after midnight. CreditChina Network/Reuters
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Singles Day will test Alibaba’s logistics network. The company expects half a billion Chinese consumers to visit its platforms during the shopping festival; they will have access to more than 60,000 brands.CreditAgence France-Presse — Getty Images

Singles Day is now inextricably linked with Alibaba, the Chinese e-commerce leviathan that in recent years has turned the holiday into an online — and occasionally brick-and-mortar — mercantile extravaganza. It routinely eclipses Amazon’s yearly Prime Day promotional event.

In July, Prime Day generated an estimated $1 billion in revenue during its 30-hour sale window, resulting in what Amazon called its “biggest day ever.”

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Jack Ma, the chairman of Alibaba Group, appeared with the actress Nicole Kidman during a gala on Friday in Shanghai to mark the company’s Singles Day promotions. CreditAly Song/Reuters
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Alibaba’s Singles Day gala, held before the e-commerce giant’s annual shopping extravaganza, drew performers like the singers Pharrell Williams and Karen Mok. CreditAly Song/Reuters

The event has evolved into a cultural phenomenon. On Friday night, Alibaba hosted a lavish gala in Shanghai, directed by one of the producers behind the 2016 Academy Awards. Celebrities such as Nicole Kidman, Pharrell Williams and Maria Sharapova helped count down the moments before the 60,000 participating global brands released their Singles Day deals to shoppers.

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A visitor at the command center in Beijing for the Chinese e-commerce giant JD.com. The digital map behind him shows the flow of deliveries across the country on Singles Day. CreditNg Han Guan/Associated Press
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Workers prepare packages at a sorting center in Beijing for the Internet retailer JD.com on Saturday, Singles Day in China.CreditEuropean Pressphoto Agency

One offer, from the Chongqing-based online alcohol brand Jiang Xiao Bai, allowed 33 fast-moving customers to make a single payment of 11,111 yuan, or $1,673, for a lifetime supply of a grain liquor known as baijiu.

Singles Day, which is largely powered through Alibaba’s Tmall marketplace, was a test of the company’s logistics network. The company promised delivery within an hour for certain products and, in advance of the shopping festival, converted nearly 100,000 stores across China into “smart stores” capable of processing payment using facial recognition and other advanced technologies.

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A woman on Saturday with a shopping bag in Shanghai on Singles Day, China’s much larger version of Black Friday.CreditAly Song/Reuters

China, Hong Kong Received Dominant Share of Global PropTech Investments Since 2013

China, Hong Kong Received Dominant Share of Global PropTech Investments Since 2013

According to new research from JLL, property technology – or PropTech – start-ups in Asia Pacific are outpacing their counterparts in Europe and the United States with 179 of them raising around $4.8 billion in funding since 2013. This represents over 60 percent of PropTech investment worldwide.

Greater China, including mainland and Hong Kong, raised the most funding in Asia Pacific and has received about 41% of global ‘PropTech’ investment.

The real estate consultant today released the findings of its report — Clicks and Mortar: The Growing Influence of PropTech — which analyses the state of PropTech and its growth potential in 13 markets across Asia Pacific. Commissioned by JLL and authored by start-up community Tech In Asia, the report also reveals the forecast for PropTech growth in the region, predicting that funding will reach $4.5 billion a year by 2020.

A blend of the words property and technology, PropTech refers to the application of technology to solve challenges in the real estate sector.

“Technology and real estate are converging in exciting ways. We’re already seeing the potential of data analytics, artificial intelligence, the Internet of Things, virtual reality and blockchain, to transform how we invest in and occupy real estate in the future,” says Anthony Couse, CEO, JLL Asia Pacific.

“The findings of the report show that there is a great deal of potential for PropTech in Asia Pacific. With its young population, rapid urbanization and ‘mobile first’ mindset, all the conditions are in place for this new sector to accelerate, bringing increased efficiencies and better experiences for the end-user.”

Asian PropTech giants

According to the report, Greater China and India emerged as the top two markets for PropTech start-ups in the region, based on funding value and total number of deals. Those in Greater China raised the most funding with approximately $3.02 billion or over 60% per cent of Asia Pacific’s total funding from 34 deals. India has the highest number of PropTech start-ups in Asia Pacific at 77 deals which, combined, raised a total of $928 million.

Christopher Clausen, associate director of Asia Pacific Research at JLL said, “The high cost of living in Hong Kong and the city’s history as a traditional financial centre have arguably held back innovation and the development of the tech industry in Hong Kong. But the city’s tech industry is steadily gaining momentum and there are an increasing number of unicorns that got their start in Hong Kong. The Hong Kong Government’s recent launch of the HKD2 billion Innovation and Technology Venture Fund should help spur further growth of the tech, and with it PropTech, sector in Hong Kong,”

“Also, the government can support the development of the tech sector, including PropTech, through tax holidays and business incubators for qualifying companies. But ultimately it will be market forces that determine whether Hong Kong’s tech industry continues to grow. Hong Kong work visas for expatriates with tech skill sets in demand would also support the growth of the industry,” continued Clausen.

PropTech-evolution-chart.png

PropTech evolution

The report revealed that PropTech in Asia Pacific has evolved significantly since it first emerged in 2007 with residential property listing start-ups. In its current iteration, it is beginning to serve larger enterprise needs and the commercial real estate sector.

PropTech startups serve four main verticals or niches, says the report: Brokerage and Leasing, Investment and Financing, Project Development, and Property Management. More than half (52 per cent) of the start-ups that have raised funding since 2013 are in the brokerage and leasing space, where they serve as a marketplace for brokers, property owners and purchasers.

“What’s really interesting for a company like JLL is that more start-ups are beginning to emerge that bring solutions that are scalable for big corporate needs,” explains Mr. Couse. “Once we start to see the application of technologies such as 3D printing, robotics and drones alongside the rise of Smart Cities in Asia, it could lead to a transformation of the real estate industry.”

Asia’s PropTech ‘unicorns’

Based on a specially developed matrix analyzing the Total Investable Real Estate Universe by JLL and Digital Savviness defined by the World Economic Forum’s Networked Readiness Index, Tech in Asia projects that the countries with the highest potential of nurturing unicorns – or billion dollar start-ups – in Asia Pacific are China and Japan.

“We’ve noticed that China already has PropTech unicorns. Notably – Lianjia – raise $1.69 billion for its tech-enabled brokerage business. Given the country’s enthusiastic adoption of FinTech and mobile payments, there are likely to be more in China. But we also think Japan is ripe to create a billion dollar startup because of its eagerness to adopt blockchain,” says Terence Lee, chief editor at Tech in Asia.

“While many of the start-ups we follow are in areas such as e-commerce and gaming, we believe that PropTech is one of the key sectors to watch in the next three to five years.”

Courtesy: World Property Journal

Chinese, US ‘unequivocal’ on rejecting nuke-armed North Korea: Tillerson

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Secretary of State Rex Tillerson said talks here between President Donald Trump and Chinese President Xi Jinping forged an “unequivocal” agreement between both countries that North Korea cannot be allowed to have nuclear weapons.

“There is no disagreement on North Korea. We were pretty pleased by the fact that the Chinese have been really clear and unequivocal that they will not accept a North Korea with nuclear weapons,” Tillerson told ABC News’ Cecilia Vega in a briefing at the conclusion of the summit.

“Our efforts are complementary -– not in any way contradictory -– to bring Pyongyang to the negotiating table about how they will denuclearize their country,” he said.

While the comments highlighted a key area of common ground, officials gave no indication of new steps China would take to help resolve the standoff with North Korea or a clear timeline for other possible moves in the future.

Tillerson acknowledged that Trump and Xi differ in timing, tactics and approach to pressuring the Kim Jong Un regime. He said China believes the sanctions currently in place need time to have maximum effect.

“We’ve had some tremendous discussions on that today and I think things will happen, I believe things will happen,” Trump said during the meeting with Xi.

White House aides have said Trump believes Xi uniquely holds the key to resolving the crisis in North Korea. China is the Kim regime’s largest financial benefactor and has multiple points of leverage — from cross-border trade, to bank accounts and oil exports.

U.S. President Donald Trump speaks during a joint press conference with Chinese President Xi Jinping at the Great Hall of the People, Thursday, Nov. 9, 2017, in Beijing. (The Associated Press)
U.S. President Donald Trump speaks during a joint press conference with Chinese President Xi Jinping at the Great Hall of the People, Thursday, Nov. 9, 2017, in Beijing. (The Associated Press)
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Tillerson suggested Trump showered Xi with flattery in their meetings to try to drive home that point.

“President Trump has been very clear with President Xi -– that you are a very powerful neighbor of theirs, you account for 90-plus percent of their economic activity, you’re a very strong man and you can solve this for me,” Tillerson said.

At a joint press conference by Trump and Xi, both men expressed optimism for a solution short of war.

“As long as we stand together, with others if necessary, against those who threaten our civilization that threat will never happen. It doesn’t even have a chance,” Trump said.

Courtesy: abc

Trump and Xi hail ‘$250 billion’ trade deals

All looked rosy on Thursday as the US and Chinese Presidents trumpeted trade deals countries supposedly worth over $250 billion between their countries. But is the striking figure quite what it seems?

China Donald Trump & Xi Jinping (Reuters/D. Sagolj)

US President Donald Trump and Chinese President Xi Jinping celebrated trade deals between their countries supposedly worth over $250 billion (€223 billion) on Thursday, during day two of Trump’s visit to the country.

Several major deals were announced. Aircraft manufacturing giant Boeing agreed to sell 300 planes worth $37 billion to the state-controlled China National Aviation Holding while US telecommunications company Qualcomm agreed deals worth $12 billion with three Chinese phone makers.

The biggest and arguably most significant deal of all sees an $83.7 billion investment by the China Energy Investment Corp, to take place over a 20-year period, in chemical manufacturing projects and shale gas developments in West Virginia, a state that recorded a huge Trump vote in last year’s US Presidential election.

Several other smaller agreements, many involving energy companies, were also announced.

However, while Trump will likely return to the United States hailing the agreements as further evidence of his self-proclaimed reputation as a master deal-maker, there are more than a few caveats attached to the “$250 billion” figure, primarily the fact that many of the agreements are nonbinding memorandums of understanding rather than legal contracts. In other words, they can very easily be reneged on.

Watch video01:45

Xi Jinping hosts President Trump in Beijing

Also, many of the biggest deals are centeredon US companies that already do major business in China — such as Boeing and Qualcomm — so to what extent the deals are actually new, or in any meaningful sense connected to Trump’s dealmaking skills, is unclear.

Trump, who has long railed against China for the country’s trade policies, was in a far more conciliatory mood when speaking alongside Xi in Beijing. He blamed his US predecessors for an “out of kilter” trading relationship with China and repeatedly praised the Chinese leader as “a very special man”.

The art of the deals?

US Commerce Secretary Wilbur Ross — who earlier this week was named in the Paradise Papers for investments he made in a company linked to Vladimir Putin’s son-in-law — boasted on Wednesday of “$250 billion” worth of deals between China and the US but the full details were only revealed on Thursday.

With a raft of high-ranking US CEOs accompanying Trump on his trip, several deals were expected and Ross announced agreements on Wednesday worth $9 billion, featuring around 20 US companies including General Electric, DowDuPont and Bell Helicopter, many of which already have extensive Chinese partnerships.

The Qualcomm deal saw $12 billion worth of nonbinding agreements signed with phone makers Xiaomi, OPPO and Vivo, a continuation of the San Diego-based firm’s longstanding investment in China, where it already does most of its business.

The deal between Boeing and China National Aviation Holding certainly sounds major although among those to proclaim skepticism at the significance of the deal was former Mexican ambassador to China Jorge Guajardo, who, amid a series of comments on Trump’s trip, wrote on Twitter: “Interesting to see how many of those are past agreements/purchase orders repackaged. Beijing is a master of selling the same agreement 10 times.”

Interesting to see how many of those are past agreements/purchase orders repackaged. Beijing is a master of selling the same agreement 10 times. https://twitter.com/bpolitics/status/928254975368663040 

The West Virginia investment is the first major overseas investment by the newly formed China Energy group and will be very well received by those US voters whose faith in Trump was based on his supposed ability to bring about such deals.

China’s Commerce Minister Zhong Shan said the deals were “truly a miracle” but there was much more caution from market analysts.

“I suspect they might be primarily MOUs (memorandum of understandings) instead of actual contracts and the actual contract amount may be substantially less,” Alex Wolf, an economist at Aberdeen Standard Investments, told Reuters.

Tremendous for both of us”

Other criticism focused on the fact that the deals would not grapple with more structural concerns regarding the bilateral trading relationship with China, such as the various restrictions the Chinese government places on the operations of several US firms operating in the country, ranging from the blocking of internet giants such as Facebook and Google to the protectionist measures used against car makers.

Read more: EU firms want better access to Chinese market

Nonetheless, the generally positive tones were welcomed by US and Chinese commentators. Xi heralded the dawn of a more transparent and open Chinese economic age in relation to how it deals with foreign firms while Trump, although regularly referring to the “shockingly high” trade deficit between the countries, was also effusive.

“We will make it fair and it will be tremendous for both of us,” Trump said, drawing a wide smile from Xi when he insisted that it was previous US Presidents, rather than China, who were to blame for the deficit.

Yet while the rhetoric was soaring and will no doubt continue to be, many of Thursday’s deal announcements have a way to go to prove they are worth the paper they are written on, if they are on paper at all.

Watch video01:46

Trump on Asia visit lauds China as problem-solver

aos/mm (Reuters, dpa)

Courtesy: DW

Sieren’s China: Xi Jinping – the equalizer

Though the West may look critically at the fact that China’s Communist Party’s power is increasing, within China it could mean more prosperity and a fairer distribution of wealth, writes DW columnist Frank Sieren.

Xi Jinping at the Communist Congress (Reuters/J. Lee)

China’s most important political event of the year — the 19th Congress of the Communist Party of China — is over. China’s “strongman” Xi Jinping is stronger than ever. The anti-graft tsar Wang Qishan is no longer in the seven-member Politburo Standing Committee, which has five new faces, none of which is an obvious successor to Xi. Prime Minister Li Keqiang remains in office.

In his closing speech, Xi said socialism with Chinese characteristics had entered a “new era.” Earlier, in a three-and-a-half-hour-long opening speech peppered with convoluted Marxist expressions and stiff party jargon, he had already outlined his vision for the future.

(picture-alliance/dpa/G. Jinfh)Xi solidified his grip on power at the Communist Party Congress

A new “principal contradiction”

Xi also revived the “socialist principal contradiction” that the economic reformer Deng Xiaoping introduced at the end of the 1970s to replace the Maoist “class struggle.” This theory, which every Chinese schoolchild has to learn, defines the main problem in China: Overcoming the gap “between the ever-growing material and cultural needs of the people and backward social productivity.” Thus, China’s economy has to be developed so that the country finally joins the ranks of the world’s prosperous nations.

Deng Xiaoping’s theories were considered so fundamental that they were enshrined in the Communist Party’s constitution after his death in 1997. The most ambitious and powerful leader since Deng, Xi has now re-formulated this “principal contradiction,” saying that “unbalanced and inadequate development” is the main obstacle to people seeking better lives for themselves.

To ears unversed in Marxist dialectics, this may sound cryptic but it was an indication that Xi’s view is that the wealth obtained in the past 30 years has to be distributed more equally in future, that there should be more equal opportunities and that there should be more emphasis on the environment instead of on growth at all costs. It’s music to the ears of many Chinese citizens. Now, Xi has to deliver and few will envy the pressure he is under.

A woman having her shoes shined in China (picture-alliance/dpa/M. Reynolds)Neither wealth nor poverty are hard to find in China

Social gap remains

In the world’s most populous country, the gap between the rich and the poor remains a massive problem. There are over 1.5 million millionaires in China today, but there are also 43 million people living under the poverty line, even if this number is decreasing. Millions of migrant workers travel across China every year to find poorly paid jobs in factories or at construction sites. Excess production and environmental protection measures have led to many steel and coal plants being closed down and countless workers have lost their jobs. Unemployment is set to rise as the government places more emphasis on automatization. Furthermore, 8 million graduates enter the job market every year. Their job and earning prospects don’t look as rosy as just a few years ago.

There is no doubt that Beijing has been successful in fighting poverty and unemployment. Since 1978, the per capita GDP has risen from $156 to over $8,000 even though the population has risen by almost 400 million people in the same period.

Frank Sieren *PROVISORISCH* (picture-alliance/dpa/M. Tirl)DW columnist Frank Sieren has lived in China for over 20 years

China’s Labor Ministry recently announced the lowest unemployment rate in 16 years – 3.95 percent. It had not fallen below the 4-percent mark since 2001. If these figures are to be trusted then the government has already fulfilled its plan for the year – to create 11 million new jobs and attain an employment rate of below 4.5 percent. In the first nine months of 2017, 10.97 million new jobs were created – 300,000 more than the same period last year.

Top goal is stability

Labor Minister Yin Weimin has announced that 15 million jobs will be created each year. The government is investing heavily in electro-mobility, space travel, the plane industry and digital technology. The idea is to transform China’s industrial economy into a service-based society. The economy will no longer be dependent on low-paid factory workers but on a growing urban middle-class with purchasing power. The idea is to maintain stability as Beijing is well aware that the roots of social unrest lie in poverty and inequality.

So, Xi has more power but expectations are high. He has vowed to eradicate the worst poverty by 2020 and soon afterward to have fulfilled the dream of “moderate prosperity.” Beijing will continue to exercise control and caution instead of leaving fate to the forces of the free market. This can be formulated elegantly and logically from a Chinese point of view as: Before Western companies have equal access to the Chinese market, Chinese citizens themselves have to have equal access to prosperity.

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