Official nightmare
Outside of the top circles of the new government, 2013 was more of a nightmare than a dream for many officials.
Since the beginning of the year, the government’s discipline watchdog has investigated 25 high-level officials on corruption charges. Among them are Jiang Jiemin, the head of the State Asset Supervision Administration Commission, and Li Jianye, the mayor of Nanjing. A pantheon of influential leaders at the Sinopec, a state-run oil company, have either been sacked or put under investigation. Many leaders many be afraid to shut their eyes, let alone dream a pleasant dream.
The purges come amid China’s most high-profile court case in decades, that of former Chongqing party boss Bo Xilai. Bo, the son of one of China’s eight “immortal” leaders, was arrested in 2012 and sentenced to life in prison for corruption in September.
China’s new leaders won’t rest there. Xi has pledged to take down crooked village chiefs and venal central leaders with the hopes of improving the party’s image. On the chopping block now is former security tsar Zhou Yongkang. Zhou, considered an elder among the political elite, is rumored to be under house arrest while many of his close associates have already been openly investigated.
Wakeup call
International companies were dreaming a China dream in 2012 but woke with a start in 2013. The year witnessed a handful of high-profile corruption cases targeting major names in the global business community.
In June, China announced that it had probed GlaxoSmithKline (GSK), a UK-based drug maker, for corruption. Chinese investigators claim the company bribed doctors to sell their products and GSK has admitted that it may have violated Chinese law. Since then, several company employees have been detained and sales have tumbled by 30%. Now, some 60 foreign drug makers are under investigation.
This equates to a bad night’s sleep for any international firm in the country. An annual survey released in October by corporate investigator Kroll showed that executives at global companies were wringing their hands this year. Of those surveyed, 23% described themselves as highly vulnerable to procurement fraud or other forms of malfeasance connected with their suppliers, up from just 2% in 2012. The perception of high vulnerability to conflicts of interest with management jumped to 21%, from 2% in 2012.
The past year will go down as the year that China took a swing at a long list of foreign companies across a gamut of industries. Baby-formula makers Danone and Nestle have promised to lower prices after the government accused them and other foreign milk firms of price fixing. Johnson Mead Nutrition was accused of bribing doctors to prescribe its baby formula.
In November, China’s National Development and Reform Commission launched an anti-monopoly probe into US technology company Qualcomm. For a brief period of time over the summer, European wineries
faced similar charges.
If this is the Chinese dream, foreign firms want to wake from it as soon as possible.
Dream interpretation
Ordinary Chinese, too, have much to be skeptical about as their leaders envision the future. To many, their Chinese dream in 2013 was a hazy one, obscured by thick pollution, concerns over food safety and the general cost living and healthcare.
The past year began with record-high pollution levels in Beijing but, what was dubbed the “airpocolypse” then, has since become normal. Off-the-chart levels of smog were inhaled on a regular basis by Chinese in the northeast in 2013. In December, pollution in Shanghai hit an all-time high since records were taken.
Deteriorating food safety has complimented the pollution. In March, tens of thousands of dead swines were found floating in Shanghai’s water supply. Several food scares rocked the country in 2013, including reports of rice contaminated by heavy metals in southern China.
For China’s most vulnerable, namely the 650 million rural dwellers in the country, concerns over health are one among many. Farmers wishing to relocate to an urban center still struggle to get benefits such as healthcare and education after moving. Pensions can be lost in the migration process. All the while, the wealth gap in China continues to widen.
A comfortable life is, for a majority of the country, still just a dream.
In 2014, leaders in Beijing will try to improve some of these conditions. Reform to the hukou, China’s residency system, has been promised. Some rural citizen may find it easier to locate to certain areas of the country in the coming year, but the process of opening up will be slow and expensive for the cities that have to absorb migrants.
Xi and Li aren’t just rampant dreamers. They have already shown their ability to take quick action on many much-needed economic reforms across the country. The question in 2014 is how financial reforms and bank liquidity, free trade zones and corruption crackdowns, will better the lives of the Chinese people.
The communist party has much work to do in articulating the Chinese dream into policy that the masses can intrepret, understand and experience in their waking lives.