1709533292 China is torn between greater national security and economic openness

China is torn between greater national security and economic openness International

Economy, economy, economy. China opens the political cycle this week – after the Lunar New Year break – with the financial front of a recovery not yet on the menu as the main course. But other underlying currents remain unaccounted for and will shape many of the major geopolitical disputes in this year of electoral change in the world. During the annual plenary session of the National People's Congress (the Chinese legislature with little oversight power and the control of the Communist Party), which begins this Tuesday, signals are expected from the Chinese leadership indicating where it wants to shift the weight of the balance. In the tense battle between national security and economic growth, more forceful responses could emerge to the inauguration of Taiwan's new president in May and signs of the Asian giant's direction on a planet with multiple war fires.

On Tuesday, on the opening day of the gathering attended by around 3,000 delegates, China is expected to announce its 2024 growth target, a good indicator of how Beijing views the economic landscape. Among other things, the data will also be disseminated on the defense budget, which has grown steadily in recent years (7.2% in 2023), as the country modernizes and strengthens its armed forces, one of the cornerstones on which the “new era” President is based Xi Jinping faces, attracts and is a source of tension with the first planetary superpower, the United States.

In parallel, starting this Monday, the meetings of the Consultative Conference, a diverse and colorful advisory body with the ability to propose legislative initiatives, which included the actor Jackie Chan and the basketball player Yao Ming, among others, will take place. The conference represents the other part of what Beijing usually calls “the two sessions.”

The appointment is something like a period of reflection (on the past year) and a conclave of new resolutions (for the coming year). The content is predominantly national, but it tends to give rise to signals that need to be taken into account in all areas. Prime Minister Li Qiang, elected by nearly 3,000 delegates last year, will appear before the plenary session for the first time on Tuesday to present his work report. Li, the number two in the Communist Party and Xi's loyal squire, still retains some of his aura as an open-minded businessman: He was responsible for attending the Davos forum in January and spreading the friendly message that China “with his” welcomes “open arms” for investment by foreign companies and aims to promote a “market-oriented, law-based” business environment.

Reading his report will provide clues about his latitude in the economic task in the face of increasing state control, which often touches finances and causes concern among Western businessmen. Beijing's record in this area is confusing and contradictory. While the country has allowed visa-free entry to a handful of European countries (including Spain) in recent months to revive post-pandemic stagnant exchanges and boost the economy, last week it approved the first visa reform law since 2010 State secrets, the articles of which expand the scope of what is considered “working secrets” and may further complicate companies' access to relevant information for investments. “China's increasing attention to national security has led to uncertainty among companies,” responded Jens Eskelund, President of the European Union Chamber of Commerce in Beijing, immediately.

The measure follows a trend that has long troubled much of the economy, particularly the Western one. In 2023, authorities launched counterintelligence-related raids and arrests against foreign-related consulting firms. The anti-espionage law has been reformed, and the Ministry of State Security, which is responsible for counterintelligence, has doubled its presence through an active Weibo account (the Chinese X) in which it has published a list of reasons for kidnapping a citizen from being interrogated by his agents (“invited to tea,” it is said), to a comic in which he tells of a real spy investigation (without specifying which one). The climate of pressure matches President Xi's words to the assembly a year ago when he was unanimously re-elected to a historic third term. He made the priorities clear: “Security is the foundation of development, while stability is a prerequisite for prosperity.”

Join EL PAÍS to follow all the news and read without restrictions.

Subscribe to

Because it is Xi's statement and so new, few doubt that China will stick with this approach of greater state control. But in the opaque world of Chinese politics, every noun and comma will be scrutinized in the coming days in an attempt to provide an oracle glimpse into the plans of the planet's second economic power. Even before the meeting, Trivium China analysts see a change in priorities in this battle between stability/security versus development/prosperity. They estimate that the Central Commission for Financial and Economic Affairs, the party's top economic policy body chaired by Xi, showed in a recent article that “security has also disappeared at the expense of everything else, including economic growth.” far,” says a recent bulletin. The article from the above-mentioned Commission states: “Only by expanding economic power (…) will we be able to effectively resist all types of risks.”

Economic progress is currently one of the main reasons for concern in Beijing. In the first year of the post-Covid era in China, last 2023, the first after the lifting of the strict anti-pandemic measures that gripped the country, the Asian giant's GDP grew by 5.2%, slightly is above the target set by Beijing, well ahead of the EU (0.5%) and the United States (2.5%). But China continues to show signs of slowing: the real estate sector remains in more than low hours, consumer confidence is bordering on a low, inflation has been negative for four months, private investment is declining, Chinese stock markets in Shanghai, Shenzhen and Hong Kong They are bearing losses in the millions, youth unemployment peaked in 2023 (until Beijing suspended publication of the data and reformulated the criteria). The cocktail can even become a source of social instability.

ChinaChinese President Xi Jinping speaks at the Chinese Communist Party meeting on January 16, 2024. XINHUA / SHEN HONG (EFE)

A rare public opinion poll in Guangzhou, the southern manufacturing capital, conducted by think tank Merics shows that popular dissatisfaction with the progress of the economy, employment and wages is growing: it is at its lowest point since 2015. “This Failure to implement long-overdue structural reforms to boost household well-being and income is starting to have its impact,” says Nis Grünberg, chief analyst at Merics, in a recent article. “Xi must prove that China’s state-led economic securitization approach benefits the population by introducing a broader redistribution of wealth. If this does not happen, there is a risk of further weakening of public sentiment.”

One of the issues to watch is China's repositioning toward Taiwan, perhaps with a growing wave of military maneuvers around the island to apply pressure before Lai Ching-te, the president-elect, takes office in May. The Chinese government showed a muted reaction after the elections, which were won by the Asian giant's least popular candidate, but stressed that his victory did not reflect the self-governing island's majority opinion that Beijing considers an inalienable part of its territory. “More assertive” language during the two sessions in the face of secessionist rhetoric “could be a justification for tougher measures,” Helena Lagarda, also of Merics, said during an online conversation last Friday.

Analysts are also paying attention to the possible appointment of Liu Jianchao, current director of the International Department of the party's Central Committee, as foreign minister. His name as a possible replacement has been circulating for weeks. If approved, it would be a new episode in the political tragedy that began with the disappearance of previous portfolio holder Qin Gang in July, barely six months after he took office, and continued shortly afterwards with the absence and dismissal of Defense Minister Li Shangfu. Since then, none of them have been seen, nor has any official explanation been given for their departure. The experienced Wang Yi has taken on the role of foreign minister since the summer, but several scholars believe his responsibilities may be temporary.

In the background, China's vision of the international situation will be on the radar, with the war in Ukraine now in its third year and another raw war front in the Middle East. Barely a week after several Chinese companies were hit with Western sanctions for their support of the Kremlin's war machine – a move strongly denounced by Beijing – China has again invited Li Hui, its special envoy for Eurasian affairs, on a tour of major European ones Capitals sent. including the two warring parties, Moscow and Kiev, to seek solutions to what China still calls a “crisis” or “conflict” but not a war. The lack of condemnation of the invasion, the calculated equidistance with Russia, with which the country shares many interests in the international order, and the continued expansion of trade relations between the two remain the main fault between Beijing and Western countries.

Although there is a feeling in the Chinese capital that the Asian giant has begun the Year of the Dragon by avoiding the geopolitical noise while trying to regain the economic charm that much of the international community has lost . Around this time last year, Washington and Beijing clashed over the downing of an alleged Chinese spy balloon flying over American soil, and relations between the two giants of the international arena plummeted. The agreement for this year 2024, signed in November between Xi and his American counterpart Joe Biden at their meeting in San Francisco, allows each president to take a breath, partially put aside the dispute and focus on domestic issues: Biden in the November elections ; Xi, in economic stability, which has not yet arrived.

Follow all international information on Facebook and Xor in our weekly newsletter.

Subscribe to continue reading

Read without limits