China faces rule by Xi for decades with repeal of term limits

[SINGAPORE] China's Communist Party is set to repeal presidential term limits in a move that would allow Xi Jinping to rule beyond 2023, completing the country's departure from a political system based on collective leadership.

The party's Central Committee announced Sunday it was seeking to end a constitutional provision that bars the head of state from serving more than two consecutive terms. That would remove the only formal barrier to Mr Xi, who is also party leader and commander-in-chief of the military, staying in power indefinitely.

The move was first flagged at a party meeting last October, although Sunday's formal announcement shows the extent of Mr Xi's grip on power heading into the start of his second term.

It dispenses with the orderly succession system China adopted in the aftermath of Mao Zedong's chaotic rule as it sought legitimacy from the West, and draws comparisons with Vladimir Putin's successful effort to consolidate control over Russia's post-Soviet democracy.

"China has traditionally had some degree of healthy debate within the leadership about the direction China should go," said David Cohen, a Beijing-based managing editor at consulting firm China Policy. "This move signals that those whose opinion Xi has to care about are either happy about the direction Xi is taking things, or have been effectively sidelined."

Putin Parallels

The announcement drew parallels to Mr Putin, 65, who has served in either of Moscow's top two posts since 1999 and is expected to easily win reelection next month. Russia's term limits would require him to relinquish control in 2024.

Mr Xi has visited Moscow more than other capital city since he came to power in 2012. Mr Putin told China's state broadcaster they celebrated his birthday in 2013 by drinking vodka shots "like two college students".

"I think Xi compares himself to, and is modelling himself on, Putin, and just look to see how Russia is developing," said Fraser Howie, co-author of Red Capitalism: The Fragile Financial Foundations of China's Extraordinary Rise.

"For the moment, nothing changes, of course," Mr Howie said. "Xi is only going into his second term and a lot could still happen."

Speculation that Mr Xi, 64, might seek to stay on intensified after he declined to set out a clear successor at the party's twice-a-decade leadership reshuffle in October. But the constitutional amendment represents a formal break from the succession practices China set up to establish stability and facilitate its economic revival after the tumult of the Mao era.

Mao used his cult of personality to enact industrial policies blamed for tens of millions of starvation deaths and subjected the party's elite to bloody purges.

Coming Meetings

The announcement comes a week before China's rubber-stamp parliament, the National People's Congress, meets with an agenda that includes confirming Mr Xi's second term and approving a series of constitutional changes recommended by the Central Committee. The term-limit repeal was not among the amendments announced after the committee last met in January.

The change underscores the extent of Mr Xi's power after October congress elevated him to a status alongside the nation's most vaunted political figures. Party charter changes put Mr Xi on par with Mao and Deng Xiaoping, and also declared him the party's "core" leader indefinitely.

The seven-member Politburo Standing Committee - the country's supreme political body - elected after the event included no members young enough to take power after Mr Xi's second term. That was a departure from established norms that saw Mr Xi's own appointment to the body in 2007.

Mr Cohen from China Policy said Mr Xi has had an easier time making changes than when Putin ended regional governor elections and engineered transitions between president and prime minister to evade term limits. One reason for that is China's economic success.

"Putin seemed to be on the wrong side of history when he did it," Cohen said. "I don't think anyone could confidently say now that Xi is on the wrong side of history."

Reshaping Government

After reshaping the party, Mr Xi will now put his mark on the government, with the Central Committee starting a three-day conclave Monday in Beijing.

The gathering, which Bloomberg News first reported Thursday, gives Mr Xi an opportunity to install his favored candidates at the central bank and key regulatory bodies.

In addition to selecting a successor to central bank governor Zhou Xiaochuan, authorities are considering a merger of the China Banking Regulatory Commission and the China Insurance Regulatory Commission, Bloomberg News reported.

"The structural reform of financial and economic sectors will be crucial at the meeting," said Hu Xingdou, an economics professor at the Beijing Institute of Technology. "The leaders understand a change of the financial regulatory system is a must as financial risk is increasing."

China is attempting to defuse a ticking time bomb of debt - which stands at around 260 per cent of output and growing - without crashing the economy.

Politburo members mentioned by analysts in connection with the central bank governor role include Mr Xi's top economic policy adviser, Liu He, as well as banking regulator head Guo Shuqing and Hubei provincial party chief Jiang Chaoliang. Attention at the plenum will also likely focus on Mr Xi's pick to lead the Financial Stability Development Committee, which was created last year to tackle the financial sector.

Still, Mr Xi's dominance of China's political system carries dangers of its own, said Mr Howie, the "Red Capitalism" co-author.

"This move is also not without risk for Xi," he said. "When things go wrong - and they always do - there is only one person to blame."

BLOOMBERG