Leading the party

The Porter Report - A monthly update on the business world from leading writer David Porter

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I worked for many years in Hong Kong, adjacent to China’s sprawling masses. I come from a country that has a comparatively minute population, with a transparent polity, and felt privileged to visit and try to understand what was happening in China.

David Porter

I had always been fascinated by how a country so vast, with a population of more than a billion people, went about choosing a leader. Or rather, how a Chinese leader won and maintained power in such circumstances.

I do recall a senior Chinese-born journalist working for a British news agency in Hong Kong telling me many years ago that the biggest threat China’s leadership would always have to deal with was that it could never ignore its need to satisfy its vast population.

He tended to believe that given the country’s long historical experience of unrest, a potential revolution was always at some point imminent if

the vast population became too dissatisfied. Hence China’s generally authoritarian approach to governing over the decades and the violent crushing of protests such as in Tiananmen Square. The reason for the latter was clear: China had closely monitored the Soviet Union’s then splintering into smaller components and had no intention of following the same path.

By contrast, it has been almost comic to observe the recent mid-term elections in the US. And to observe that, despite the proliferation of a free-speaking media, a much smaller population base, and its role as a global power, the US remains clearly politically at odds with itself.
It has also been a revelation to watch how media pundits so convincingly got the outcome of these elections wrong. So not everyone voting loved
ex-president Trump’s endorsees? What a surprise.

Communication on the side-lines

It was of some international comfort to note that US President Joe Biden and Chinese President Xi Jinping were able to meet cordially for talks on the side-lines of the recent G20 meeting in Indonesia.

The discussions included current hot points: Taiwan and North Korea. North Korea remains a problem, but it is my belief that Taiwan will never become a source of global conflict, although it will remain a useful stick for China to beat outsiders with. I believe Taiwan is much lower on

China’s priorities list than it sometimes seems. And I suspect that Russia’s experience in the Ukraine has caused China to quietly revise the timing of its policies on Taiwan.

The recent Communist Party Congress enshrined President Xi for an unprecedented third five-year term. Xi is clearly a capable leader. He is the son of a Chinese Communist veteran, with well-maintained links to other influential “princelings”, and has survived his own Cultural Revolution and other political setbacks.

But the country is grappling with a slowing economy and an increasingly fractious population, which is clearly showing irritation at the leadership’s hard-line handling of Covid-19.

What was interesting to many outside observers was Xi’s overt display of personal authority during October’s Congress. Having been re-elected, by a small group of political dignitaries, Xi then had retired Chinese president Hu Jintao ushered unceremoniously out at the end of the meeting.

Widely televised on foreign media, it is understood that this scene was not seen on any Chinese state media, which was left with the impression Hu was one of those dignitaries wholeheartedly supporting Xi. That did not appear to be the case. Rather, it came across as an external assertion of Xi’s newly enhanced authority.

We obviously cannot ignore the importance of major New Zealand trading partners such as China and the US. According to late 2021 figures, China absorbed some $21.45 billion in New Zealand exports and services, especially dairy, meat and wood, and sent us $16.26 billion of its own exports and services.

We must continue to make every effort to understand China and its governance.

We are delighted in this issue of Bay of Plenty Business News to bring you our special focus December Thought Leaders feature. We have talked to the Bay’s leading businesspeople to get their thoughts on business as 2022 draws to a close.

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David Porter
David Porter
THE PORTER REPORT - A monthly update on the business world from David Porter

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