China's Economic Weight (c) Michael Osbun

A summit between the world's two most powerful leaders is important at any time, but when China's President Hu Jintao goes to Washington in the New Year to see President Barack Obama, there will be lots of unanswered questions about the directions their countries are taking.

There is plenty of debate in the United States about the changes likely following the midterm elections. President Barack Obama is a man with a mission: to prove himself to the electorate in two years time. Change is afoot in China too. President Hu Jintao is probably making his last trip to Washington as China's top man; 2012 will be an important year there as well. But policy evolves in a very different way in Beijing.

A clue to what will happen after the all-important Chinese Party Congress at the end of 2012 was given on October 18. At a high level meeting in Beijing, there was a very low key announcement. It simply stated that 57 year old Politburo member Xi Jinping had been appointed as one of the Vice Chairs of the Central Military Commission.

While a statement of only a few words, it carried great import. For, if past experience is anything to go by, then this appointment means that Xi is almost certain, barring disaster or total breakdown, to become the leader of China at that Congress. October 18, for Xi at least, was a very good day.

Running Smoothly

At the same time as he was elevated, the elite in the Communist party also signed off on China's next Five Year Programme - they used to be called Plans - which will run from next year to 2015. This set no specific targets for gross domestic product growth, but laid out the general framework within which the leadership will try to guide and grow the country in the next half decade.

The overarching ambition remains the same - to create a middle-income country, with more balanced growth and far less inequality. Sustainability and energy security all took their part in this long, ambitious document.

As a statement of political intent, it was clear enough. China is on the right track, despite the coming leadership changes there will be no big impact on policy, everything is in order and running smoothly and no one should be concerned. That, at least, is what the party collectively wants the world, and, most importantly, people in China to think when they read the Programme.

But on the same day the Programme was being discussed in Beijing, anti-Japanese demonstrations were taking place, snarling up the traffic in Xian in central China, and Chengdu in the south west. Placards with some of the strongest language yet seen against their regional neighbour were carried through the streets. In one place, reportedly, a woman wearing a Japanese style kimono was forced to remove it.

On the internet, bloggers were for once appalled by the crudeness of the nationalistic attacks. But the very fact that so many had been able to march was telling. Somewhere in government, there had to be some level of collusion.

On top of this, on the day of Xi's elevation a campaign was kicked off in the People's Daily introducing many Chinese readers for the first time to the name Liu Xiaobo. Liu had, only a week before, become the first citizen of the People's Republic of China to win the Nobel Peace Prize, or any other Nobel prize for that matter, while still in China. But as the newspaper was keen to point out, he was officially branded a criminal, serving the first year of an eleven year sentence handed to him last Christmas Day for state subversion.

Far from, as some expected, dismissing the prize as nothing more than a piece of foreign mischievousness, the official government response had been sharp and wounded.

To compound matters, as the Party elite was meeting in Beijing, over a hundred intellectuals, former officials - including a man who had served as Mao Zedong's private secretary in the 1950s - and writers, all still based in China, issued a public letter calling for Liu's immediate release. They also reasserted the legitimacy of his demands for deeper political reform.

Speeding Reform

Political reform was also on the mind of one of those leaders who are on their way out. But going by current form, Premier Wen Jiabao evidently does not wish to slip quietly into retirement in two years. In an interview with CNN while preparing for the Asia Europe Meeting at the start of October, he said that political reform needed to be speeded up, echoing comments he had made only a month before while in Shenzhen celebrating the thirtieth anniversary of economic reforms there.

The fact that Wen's comments were censored when relayed back on Chinese television only alerted some to the real possibility that the fractures they had always been trying to spot in the top elite in the Party were now finally showing up.

Before the October Party meeting there had been expectation that political reform was going to figure much more strongly. But the final communiqué contained only the most anodyne language about this. The emphasis was still on economic reform, improving people's lives, building a more prosperous, wealthier society.

Taken together, this snapshot of how things stand in China during its transition to a new group of leaders gives enough evidence of conflicting currents and debates in the Party. Most of the problem is simply of the same kind facing other leaders, from Obama dealing with the verdict of the US voters in the mid-term elections, to French President Nicolas Sarkozy trying to produce a popularist message to placate his many domestic critics - finding an overarching narrative that defines their key tasks, and gains them support from a complex, often very skeptical public.

The contradictory response towards Japan, from warm leaders words to vicious verbal attacks on demonstrator's placards, the contradictory messages about what the elite thinks about political reform and how it intends to deal with this issue in the next five years, to the botched decision to put Liu in jail last year, and then to lash out at foreign entities for recognising him, all indicate a lack of consensus and cohesiveness.

China's silence, too, during the Party meeting, about what it plans to do in the face of mounting US-led pressure on the claimed undervaluation of its currency, is a further part of all this.

Sorting Out The Story

As he enters the final stretch of his journey towards supreme leadership in China, Xi will know that he, more than any other leader, will have a major responsibility to sort this narrative out. Part of it will be about deciding what, precisely, China is - a poor, developing country, as it sometimes presents itself, or a rising superpower, as it appears to many of its neighbours. How does it want the world to see it? What sort of power does it want to become?

And, for the Party which runs this country, there is the issue of what it means when it says reform and modernisation, and how far it allows these processes to penetrate its deeper political workings. Xi will be one of the men who has the greatest influence in deciding what to do about these massive, ingrained identity problems.

And it is unlikely Xi will have until 2012 to start deciding about the practical issues of modernising not just the way China operates as an economy, but how it works as a political, diplomatic and cultural entity. His baptism by fire has already begun, and so far, he has given almost no indication of where he stands on the major issues he will be in charge of in under two years time.

 

Kerry Brown, Senior Fellow, Asia Programme, Chatham House. The World Today is published by Chatham House in London

 

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(C) 2010 The World Today