China’s policy makers have a lot on their plate. At the press conference marking the close of the first session of China’s 11th National People’s Congress (NPC), Premier Wen Jiabao addressed rising inflation, riots in Tibet and possible Olympics boycotts.
He said that 2008 may be the “hardest year” for China’s economy and that navigating these risks would require China to “blaze a trail in between [curbing inflation and nurturing economic growth]. ”
In a bid to create a leaner, cleaner government better equipped to face these challenges, the NPC approved its sixth cabinet-level shakeup since 1982. This will see the creation of five new “super-ministries” to cover transport, human resources and social security, industry and information, housing and urban-rural construction, and the environment. In addition, the Ministry of Health absorbed the State Food and Drug Administration. The reshuffling saw China’s cabinet reduced in size to 27 from 28.
For the most part, there were few surprises in terms of new parliamentary appointments. Xi Jinping and Li Keqiang, the two high-profile additions to the Politburo Standing Committee in October, were named vice president and first rank vice premier, respectively. It is thought that this could put Xi in line to succeed Hu Jintao as president in 2012, while Li would step into Wen’s shoes as premier.
Wang Qishan, formerly mayor of Beijing, was appointed vice premier with responsibility for economic and financial policy. Zhang Dejiang, formerly Guangdong party secretary, was also promoted to vice premier and will most likely assume the energy and infrastructure brief. Hui Liangyu retained his post as vice premier in charge of agriculture.
Two appointments did raise some eyebrows. Zhang Ping, a relatively unknown former deputy secretary general for the State Council, was named as head of the National Development and Reform Commission. Meanwhile, to the surprise of many, Zhou Xiaochuan was reappointed governor of the central bank. Analysts said the retention of Zhou is a sign that China wants stability in its current fiscal policies.
Whether the government’s makeover will provide that stability is a question that will have to wait until next year.