Lifting the Curtain on the Chinese Communist Party

China has elections this year, in a manner of speaking. The 18th Congress of the Chinese Communist Party will meet later this year to elect a new Politburo and a new nine-member Standing Committee of the Politburo (PBSC). This election only happens once every ten years, so it’s kind of a big deal.

Seven of the nine seats on the Standing Committee will be filled. Until recently, the results weren’t much in doubt. Several reformist and “New Left” (Maoist) factions have reached an uneasy balance of power. But all that has changed in the last few months.

In November a British businessman named Neil  Heywood was found dead in the city of Chongqing. His death has lifted the curtain on the internal rivalries within the Chinese Communist party. At stake is the legitimacy of the Party itself and its centrality in Chinese political and economic life.

We realise that’s a big claim. It means China could experience far more political upheaval this year than anyone’s expecting, and perhaps even more than America. We’ll have more on this story for you tomorrow. But in the meantime, here are the main players in the drama.

  • Neil Heywood. A 41-year-old British businessman, married to a Chinese woman and living in China for the last 10 years. Was found dead in a Chongqing hotel room in November. Friend and ally of Bo Xilai.
  • Bo Xilai. 62-year-old son of Bo Yibo. Bo Yibo was one of Mao’s right hand men and one of the “Eight Immortals”, hardliners who supported Deng Xiaoping. Bo Xilai was, until recently, a member of China’s 25-person Politburo and the Communist Party chief of Chongqing, a city of 32 million people. Also identified as a shoe-in for membership, as a hardliner, on the PBSC in October.
  • Gu Kailai. Bo’s 53-year-old multimillionaire lawyer wife . Stands accused of the murder of the Neil Heywood.
  • Zhou Yongkang. Current member of the PBSC and ally of Bo. Also allied with Jiang Zemin.
  • Hu Jintao. President of the People’s Republic of China, member of the PBSC, and reformer.
  • Xi Jinping. Vice President of the People’s Republic of China, Hu’s hand-picked successor, and current member of the PBSC.
  • Wang Lijun. Bo’s chief of police in Chongqing up until early February, 2011. Attempted to defect to the US consulate in Chengdu   on February 7th.

This story may be an ordinary story about a politician who reached too far, too fast, and was swiftly routed by his rivals. Or, it may be a larger story on whether the Chinese Communist Party can retain its legitimacy as allegations of corruption and murder become, for the first time, public. Stay tuned.


Dan Denning
for Markets and Money

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Dan Denning
Dan Denning examines the geopolitical and economic events that can affect your investments domestically. He raises the questions you need to answer, in order to survive financially in these turbulent times.

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” China will spend 111.4 billion dollars on public security, which includes police and state security forces, in the coming year — an amount that exceeds even the defense budget. “”

At stake is the legitimacy of the Party itself and its centrality in Chinese political and economic life.

Says it all !

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