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Thursday, 8 November 2012 - China's Hu says graft threatens state, party must stay in charge |
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      Edition: U.S. Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Home Business Business Home Economy Technology Media Small Business Legal Deals Earnings Social Pulse Business Video The Freeland File Aerospace & Defense Investing Simplified Markets Markets Home U.S. Markets European Markets Asian Markets Global Market Data Indices M&A Stocks Bonds Currencies Commodities Futures Funds peHUB Dividends World World Home U.S. Brazil China Euro Zone Japan Mexico Russia India Insight World Video Reuters Investigates Decoder Politics Politics Home Election 2012 Campaign Polling Supreme Court Politics Video Tech Technology Home MediaFile Science Tech Video Tech Tonic Social Pulse Opinion Opinion Home Chrystia Freeland John Lloyd Felix Salmon Jack Shafer David Rohde Nader Mousavizadeh Lucy P. 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Credit: Reuters/Carlos Barria By Sui-Lee Wee and Ben Blanchard BEIJING | Thu Nov 8, 2012 12:46am EST BEIJING (Reuters) - Outgoing Chinese President Hu Jintao warned on Thursday that corruption threatens the ruling Communist Party and the state, but said the party must stay in charge as it battles growing social unrest. He also promised political reform, but offered no dramatic changes and ruled out copying a Western style of government. In a "state of the nation" address to more than 2,000 hand-picked party delegates before he hands over power, Hu acknowledged growing public anger over graft and issues like environmental degradation had undermined the party's support and led to surging numbers of protests. "Combating corruption and promoting political integrity, which is a major political issue of great concern to the people, is a clear-cut and long-term political commitment of the party," Hu warned. He was opening a week-long congress at Beijing's Great Hall of the People that will usher in a once-in-a-decade leadership change in the world's second-largest economy. "If we fail to handle this issue well, it could prove fatal to the party, and even cause the collapse of the party and the fall of the state. We must thus make unremitting efforts to combat corruption," Hu said in a nearly two-hour speech. The run-up to the carefully choreographed meeting, at which Hu will hand over his post as party chief to anointed successor Vice President Xi Jinping, has been overshadowed by a corruption scandal involving one-time high-flying politician Bo Xilai. The party has accused him taking bribes and abusing his power to cover up his wife's murder of a British businessman in the southwestern city of Chongqing, which he used to run. While Hu did not name Bo - a man once considered a contender for top office himself - he left little doubt about the target of his comments. "All those who violate party discipline and state laws, whoever they are and whatever power or official positions they have, must be brought to justice without mercy," Hu told delegates, one of whom was his predecessor, Jiang Zemin. "Leading officials, especially high-ranking officials, must ... exercise strict self-discipline and strengthen education and supervision over their families and their staff; and they should never seek any privilege." The New York Times said last month that the family of Premier Wen Jiabao had accumulated at least $2.7 billion in "hidden riches", a report the Chinese government labeled a smear. JIANG'S CLOUT Hu entered the venue accompanied by Jiang, signaling the former president still wields considerable influence in the party and in the secretive deliberations to decide on the new leaders. As Hu delivered his speech under a massive, golden hammer and sickle, a healthy-looking Jiang sat flanked by senior members, party elders such as Li Peng and incoming leaders such as Xi. The congress ends on November 14, when the party's new Standing Committee, at the apex of power, will be unveiled. Only Xi and his deputy Li Keqiang are certain to be on what is likely to be a seven-member committee, and about eight other candidates are vying for the other places. The congress also rubber-stamps the selection of about two dozen people to the party's Politburo, and approves scores of other appointments, including provincial chiefs and heads of some state-owned enterprises. "We must uphold the leadership of the party," Hu said. He also named health care, housing, the environment, food and drug safety and public security as areas where problems had "increased markedly". The meeting is a chance for Hu to cement his legacy before retirement and ensure a smooth handover of power, and his prime-time speech was a chance to push his achievements and perhaps help steer a course going forward. "It was a rather conservative report," said Jin Zhong, the editor of Open Magazine, an independent Hong Kong publication that specializes in Chinese politics. "There's nothing in there that suggests any breakthrough in political reforms." While Hu promised unspecified "reforms to the political structure" and more encouragement of debate within the party, he gave no hint that China would allow broader popular participation. "We should ... give full play to the strength of the socialist political system and draw on the political achievements of other societies. However, we will never copy a Western political system," Hu said. While Hu will step down as party leader, Xi will only take over state duties at the annual meeting of parliament in March. Just weeks after anti-Japan riots swept city streets following a row over disputed islands, Hu also said China should strengthen the armed forces, protect its maritime interests and be prepared for "local war" in the information age. "We should enhance our capacity for exploiting marine resources, resolutely safeguard China's maritime rights and interests and build China into a maritime power," he said. China is also locked in dispute with Southeast Asian neighbors over areas of the South China Sea. Relations with the United States have been bogged down by accusations of military assertiveness in the region from both sides. The government has tightened security in the run-up to the congress, even banning the flying of pigeons in the capital, and has either locked up or expelled dozens of dissidents it fears could spoil the party. DRAGGED AWAY Security was especially tight on Thursday around the Great Hall and Tiananmen Square next door, the scene of pro-democracy protests in 1989 that were crushed by the military. Police dragged away a screaming protester as the Chinese national flag was raised at dawn. The party, which came to power in 1949 after a long and bloody civil war, has in recent years tied its legitimacy to economic growth and lifting hundreds of millions out of poverty. Hu said China's development should be "much more balanced, coordinated and sustainable", and it should double its 2010 GDP and per capita income by 2020, as previous targets have implied. But China experts say that unless the new leadership pushes through stalled reforms, the nation risks economic malaise, deepening unrest, and perhaps even a crisis that could shake the party's grip on power. Chinese growth slowed for a seventh straight quarter in July-September, missing the government's target for the first time since the depths of the global financial crisis, but other data point to a mild year-end rebound. Advocates of reform are pressing Xi to cut back the privileges of state-owned firms, make it easier for rural migrants to settle permanently in cities, fix a fiscal system that encourages local governments to live off land expropriations and, above all, tether the powers of a state that they say risks suffocating growth and fanning discontent. (Additional reporting by John Ruwitch, and James Pomfret in Hong Kong; Writing by Nick Macfie; Editing by Raju Gopalakrishnan) World Investing Simplified Tweet this Link this Share this Digg this Email Reprints   We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (6) DeanMJackson wrote:   Edition: U.S. Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Connect with Reuters Twitter   Facebook   LinkedIn   RSS   Podcast   Newsletters   Mobile About Privacy Policy Terms of Use AdChoices Copyright Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us   Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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