Economics & Country Risk Blog

China announced the members of its Politburo Standing Committee (PBSC)




On 25 October the Communist Party of China announced the members of its Politburo Standing Committee (PBSC), the seven most powerful political positions in China. Five of the seven current members, including top disciplinary watchdog Wang Qishan who led China’s anti-corruption campaign as one of President Xi Jinping’s closest allies, have retired. OnlyPresident Xi Jinping and Premier Li Keqiang will remain for another five-year term.

The other five members of the new PBSC are:

  • Vice-Premier Wang Yang, who is reportedly favoured for promotion to executive vice-premier at the parliamentary session in March 2018;
  • Shanghai Party Secretary Han Zheng;
  • Director of the Party General Office Li Zhanshu;
  • Director of the Party's Central Organisation Department Zhao Leji; and
  • Director of the Party's Central Policy Research Office Wang Huning.

Two senior officials who were widely anticipated as successors to Xi in 2022 – Guangdong Party Secretary Hu Chunhua and Chongqing Party Secretary Chen Min'er – have not been included.

Significance

The new PBSC line-up reflects a surprising adherence to established conventions regarding retirement age and promotion with the party. Without Wang Qishan, who was rumoured to be granted office beyond the conventional retirement age of 68, President Xi’s authority on the PBSC will be more constrained than expected. However, with only one member of the Standing Committee, Shanghai Party Secretary Han Zheng, considered to be in the “Jiang Clique” – a group within the CCP close to former president Jiang Zemin, no one is likely to openly challenge the 'core' president, whose political doctrine (The “Xi Jinping Thought”) will be enshrined in the Party's constitution and attributed to him by name, an honour granted only to revolutionary leaders Mao Zedong and Deng Jioaping.

Also, without Wang Qishan, China’s ferocious anti-corruption campaign is likely to become less intense, with fewer Central Committee members targeted. Without clear candidates for succession, Xi has kept his options open at the end of his second term – including the possibility of a rare third term. China’s broad policy focus will be sustained, including gradual liberalisation of the renminbi's trading band, its internationalisation through the "Belt and Road Initiative”, and reduced incentives for bank funding of heavy industries such as steel manufacturing. Policy stability will be underscored by political alignment between Vice-Premier Wang Yang and Premier Li Keqiang.

Keerti Rajan, Head of Desk, Country Risk – Asia-Pacific at IHS Markit
Posted 25 October 2017

About The Author

Head of Desk, Country Risk – Asia-Pacific

Keerti Rajan joined IHS Markit in December 2013 and the Country Risk team’s Asia-Pacific desk in September 2016. He oversees all country risk analysis of the region, and is lead analyst for India. Before joining the Asia-Pacific desk, Keerti headed the Political Risk team, responsible for global calibration of political and business risks and development of the team’s methodology. Before joining IHS Markit, he worked in the Financial Stability wing of the Bank of England, built stochastic forecasting models for Moore Stephens consulting firm, and worked in RBS's equity derivatives business.

At the Bank of England he worked with the (then-) Financial Services Authority and HM Treasury to assess systemic credit and liquidity risks to UK financial stability, providing briefings for the Governor of the Bank of England and the Chancellor of the Exchequer.  At Moore Stephens Consulting he developed modelling solutions for a range of businesses but focusing mainly on claims provisioning and capital adequacy for insurers. At RBS, Keerti’s team acted as a node between the equity derivatives trading desk, risk control functions, and settlements.

Keerti holds a PhD in Political Economy from the University of Cambridge, and an MPhil in Political Studies and an MA in International Political Economy from the University of London. His academic work has focused on emerging Asia, with a master’s dissertation comparing Indonesia and Malaysia in the Asian financial crisis and doctoral work assessing the politico-economic causes and public health consequences of income inequality in India using linear and logistic regression.