Karim Raslan: The Chinese Engine
China is Indonesia’s largest market, and much of the archipelago’s economic health is presaged on Chinese demand.
However, China’s “boom” has started to wilt over the past six months, as canceled orders for thermal coal shipments, delayed payments and spiraling costs in Guangdong province and Shanghai have spooked investors.
Adding to the confusion is the complication of the Chinese Communist Party’s quinquennial National Congress, during which a new generation of leaders is ushered into the all-powerful Politburo. High-level intrigue in Beijing is hard to follow, especially due to the state-run media that focuses more on order and unity than reporting stories.
The situation has been plunged into even greater opacity by the dramatic fall of Bo Xilai, the once-ascendant Chongqing supremo.
Nowhere are the intrigues of the Communist Party followed more closely than in Hong Kong, a city that is quickly becoming dependent on China. Recently, I met with the newly appointed editor in chief of the South China Morning Post, Wang Xiangwei, who, as the newspaper’s first-ever mainland head, underscores the changing face of Hong Kong. With his sonorous but distinctly Mandarin-inflected English, he provides an interesting perspective on the Middle Kingdom.
“I was born in Jilin, in the far north, at the height of the Cultural Revolution,” he said. “We were a poor family but I was very lucky and I managed to secure a scholarship to the premier Beijing Foreign Studies University, and then to the graduate school of the China Academy of Social Sciences.”
“Two people have had a deep affect on me over the years. The first is the songstress Teresa Teng. We all identified with her and, of course, [politician] Deng Xiaoping. His tour of Guangdong province was electrifying.”
After studying English and journalism, Xiangwei went to the United Kingdom, where he worked for the BBC (“I was living hand-to-mouth”) before moving back east and settling (“accidentally”) in Hong Kong in the years after the Tiananmen Square tragedy.
Curiously, one of his university peers was Bo Xilai. His memories of the fallen princeling are interesting: “While Bo Xilai studied journalism, he never used it professionally. However, he learned how to court and manipulate the media. In fact, he’s a very smart politician, and in a true democracy he would have survived, if not thrived.”
As our discussion moved away from Bo Xilai, I asked Xiangwei about the potential for political and economic turbulence in China.
“People are concerned about the [Communist] Party’s 18th National Congress, but it’s important to remember that the CCP has been in power for over 60 years,” he said. “They’ll manage the fallout from Bo Xilai’s exit. After all, there have been power struggles every seven to eight years, with the worst being during the Cultural Revolution.”
“There will be dissenting opinions aired before a decision is made. But after a decision is taken, the party is disciplined. They understand that a further split could plunge them into a crisis.”
“It’s the Deng Xiaoping formula, almost his doctrine: Keep a low profile, bide your time and develop the economy.”
China, Xiangwei said, needs to slow down.
“It needs to consolidate. The growth has come at a huge cost to the environment, natural resources and to the people,” he said.
Still, the country’s potential for growth is strong, he added, especially in light of urbanization.
“There will be another 200-300 million people moving into the cities,” he said. “Just imagine all the infrastructure and housing that needs to be built.”
As China becomes stronger, we in Southeast Asia need to equip ourselves with a deeper understanding of the forces at work in this future engine of global growth. As China goes, so goes Southeast Asia, and perhaps even the world.
Karim Raslan is a columnist who divides his time between Malaysia and Indonesia.