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China: Xi might stay beyond a second term

Summary:
There are no obvious candidates to succeed Xi Jinping when he completes his second term as general secretary of the Chinese communist party in 2022.The Central Committee of the Chinese communist party convened for the first time on 25 October to elect the new Politburo and the Politburo Standing Committee (PSC). Unsurprisingly, Xi Jinping and Li Keqiang were both re-elected as members of the PSC, and Xi was reappointed general secretary of the Party. The other five seats went to new faces to replace PSC members that had reached the unofficial retirement age of 68.The new PSC line-up does not contain any obvious candidate to succeed Xi in five years’ time. Given his markedly enhanced political status after the 19th Party Congress, this leads us to believe that the likelihood that Xi stays

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There are no obvious candidates to succeed Xi Jinping when he completes his second term as general secretary of the Chinese communist party in 2022.

China: Xi might stay beyond a second term

The Central Committee of the Chinese communist party convened for the first time on 25 October to elect the new Politburo and the Politburo Standing Committee (PSC). Unsurprisingly, Xi Jinping and Li Keqiang were both re-elected as members of the PSC, and Xi was reappointed general secretary of the Party. The other five seats went to new faces to replace PSC members that had reached the unofficial retirement age of 68.

The new PSC line-up does not contain any obvious candidate to succeed Xi in five years’ time. Given his markedly enhanced political status after the 19th Party Congress, this leads us to believe that the likelihood that Xi stays in power after his second term (to end in 2022) has risen, despite the fact that he would be 69 years old by then.

Several figures that were previously seen as potential candidates to succeed Xi have disappeared from the scene. Sun Zhengcai, 54 years old and previously party head in the city of Chongqing, was removed from his post in July and is now under investigation on corruption charges. Hu Chunhua (54) and Chen Min’er (57), two other potential contenders for the job, did not make it on to the PSC after the 19th Party Congress.

All the other PSC members are too old to be considered as Xi’s successor in five years times, given the unwritten retirement rule. But even if this rule were to be ignored (which would be the case if Xi is to stay on beyond 2022), none of the new PSC members look like promising candidates for the top job. Among the five newly elected PSC members, only Han Zheng and Wang Yang have demonstrated strong capabilities in managing large local economies— Wang in particular has had a rich and diversified career. However, without an obvious age advantage (Wang is only two years younger than Xi), it’s hard to see how Wang could be selected to replace Xi in 2022 and serve another decade.

About Dong Chen
Dong Chen
Dong Chen is senior Asia economist, Pictet Wealth Management. - Twelve years of working experience in macroeconomic research - Extensive knowledge about asset allocation and multi-asset class portfolios - Rich client-facing experiences with high-net-worth clients across Asia - Rigorous training in economics and comprehensive knowledge about Asian economies and business - Strong analytical skills and solid background in statistical/econometric analysis - Strong communication / presentation skills - Native Mandarin Chinese speaker and fluent in English Do not hesitate to contact Pictet for an investment proposal. Please contact Zurich Office, the Geneva Office or one of 26 other offices world-wide.

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