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SEPTEMBER 1 , 2000 VOL. 26 NO. 34 | SEARCH ASIAWEEK

Setting China's Direction
Leaders play cards, talk politics at Beidaihe
By TODD CROWELL & DAVID HSIEH Beijing

Each year about this time China's leaders flee the stifling heat of Beijing for the somewhat more salubrious climate of Beidaihe, China's premier northern seaside resort. There they play cards and take a dip in the waters of Bohai. But mostly they talk politics. This year's gathering signals the countdown to the 16th Communist Party Congress in 2002, so one can be certain a lot of the talk has been centering around who is in, who is out, who is up, who is not.

The next party congress is likely to see some major changes in the top ranks of the leadership. Premier Zhu Rongji will step aside, former premier Li Peng will probably give up his post as chairman of the National People's Congress (NPC), and President Jiang Zemin will almost certainly give up one or more of the three official positions he now holds. In fact, as many as half of the 21 Politburo members, including four out of the seven members of the elite standing committee, may retire.

Naturally, the leaders are trying to smooth the pathway for their favorites and protégés. For example, Zhu is lobbying hard to see that he is replaced by his own man, Vice Premier Wen Jiabao. But there are other contenders, notably Li Changchun, the party chief in Guangdong province. Li is a Jiang favorite, although he has been criticized by some for lacking experience. "If Li becomes premier, China will sink into chaos," noted one observer. Other candidates include Vice Premier Li Lanqing and Politburo member Wu Bangguo (the latter, though, has been criticized for his lackluster performance in reforming state enterprises).

Jiang no doubt will be pushing his main protégé, Vice President Hu Jintao, for higher things. The biggest unknown is whether Jiang will give up all of his posts, or whether he will follow Deng Xiaoping's example and keep control of the military by remaining chairman of the party's Central Military Commission. Most analysts predict the latter. Other major questions: Who will replace Li Peng as NPC chairman and who will become propaganda chief, replacing the leftist Ding Guangen? Considering Jiang's recent blast against left-wing opponents of economic reform, there may be a push for a more moderate propagandist.

Besides the all-important personnel debates, issues such as corruption, Taiwan and the economy have been looming large at Beidaihe. Since last fall, Jiang has been pushing the anticorruption issue hard. Death sentences have been given to two high-ranking cadres, most recently the former governor of Guangxi province, Cheng Kejie. The leadership was so determined to make an example of Cheng that they made him the subject of an exhibition in the capital exposing his corrupt ways and those of about 70 others. So far, about 60,000 people have paid to see it. Party cadres are also being told to watch a new anticorruption movie, A Life and Death Choice.

The Central Disciplinary Inspection Commission, the main organ charged with fighting corruption in the party, has several other big cases pending. It is anticipated that the biggest of them all, a multibillion-dollar smuggling scheme centered in Xiamen in Fujian province, should be wrapped up with some more "big fish" indictments. At Beidaihe, Premier Zhu received a delegation of investigators and gave them a pep talk. "If I, Zhu Rongji, have a problem [with graft], you should start with me," he reportedly told them.

This is the first Beidaihe gathering since the election of Taiwan President Chen Shui-bian, so cross-strait affairs are high on the agenda. Yet no major initiatives are expected to emerge from the deliberations. Beijing's options, barring provocations from Taipei, are limited. So it is probable that the party will maintain a kind of holding pattern while keeping an eye on which way Chen moves. Meanwhile, it will continue to promote economic ties and people-to-people issues. So far, the cautious Chen has not given Beijing a reason for any kind of military action. But nor has he unequivocally embraced the "one-China" policy that Beijing considers a condition for talks.

On the economy, the contours of the 10th Five-Year Plan (2001-2005) are now being hammered out in the relevant ministries. The plan is to focus on developing more knowledge-based industries, information services and software. It will also promote urbanization and encourage the private sector to soak up displaced peasants and workers let go from declining state-owned enterprises. Development of lagging regions, especially in the impoverished northwest, will also be highlighted, against the background noise of demands from regional satraps for all sorts of policy concessions. That leaves the leaders with plenty to talk about.

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