10/09/2006, 00.00
CHINA
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Social issues and jockeying for power at the centre of party plenum

Social unrest and disfunctional effects of China's wild-west capitalism are driving changes. Scandinavian welfare systems are appealing models to follow. Last stage is set for Hu Jintao to effect complete takeover of the party.

Beijing (AsiaNews) – The 350 members of the Chinese Communist Party Plenum have begun the Party Central Committee's annual plenary session. For four days they will plan strategies to map out guidelines to develop the country's "harmonious socialist society," a slogan launched first by President and party Secretary Hu Jintao in 2004.

Xinhua news agency said it was the first time in 25 years that a plenary session of the Central Committee would devote itself specifically to the study of social issues. But it will also be a venue for a new round of top party personnel changes in which party Chief Hu Jintao is expected to enlist more protégés and allies.

Many expect that the notion of Building a Harmonious Society will replace his predecessor Jiang Zemin's Theory of the Three Represents, which was used to validate China's 20-year economic growth. However, this same period saw a growing gap between haves and have-nots, widespread real estate speculation, greater pollution, energy problems, rural impoverishment and a deteriorating social safety net in terms of housing, retirement, health case and education.

Xinhua has reported for instance that the government spends only 5.5 per cent of gross domestic product on medical care—which covers only a fifth of China's population. It also noted that more than 87 per cent of rural dwellers have to pay to see a doctor. By contrast, lLast year 80 per cent of health spending went on 8.5 million government officials, a Chinese Academy of Sciences report found.

In the area of education, the central government allocates only 8 million yuan (€ 800,000 or US$ 1 million) each year to help the country's 114 million illiterate people, a mere 7 fen, or less than one US cent, per person.

Xinhua reported that the central government has started looking to welfare systems in Europe, the Americas, the Far East and Africa for ways to provide proper social security coverage. The news agency said that Mr Hu's theory had benefited particularly from Nordic countries such as Norway and Sweden.

In the end the party will make or break its legitimacy over issues like poverty, pensions, pollution, and education. Poor health care, environmental degradation, growing unemployment, land and property seizures, and especially corruption among top party leaders are creating conditions that might lead to a second Tiananmen Square crisis. The first one was solved in blood.

Indeed, party officials have not stopped worrying about growing social unrest. But till now their response has typically been arrest activists and their defence attorneys.

Hu's plans won't find much opposition according to many analysts. The recent decision to sack Shanghai's party chief Chen Liangyu for alleged real estate speculation and embezzling pension funds is a case in point.

Mr Chen, a member of the so-called Shanghai Gang led by Jiang Zemin, has reportedly clashed openly with Messr Hu and Wen since 2004 over the central government's macroeconomic controls designed to check real estate speculation and economic growth.

Chen's fate is going to be officially sealed at the plenum meeting; he is expected to be stripped of his membership and possibly kicked out of the party

If this will weaken the alliance between the business community and the party, it will also give Hu a much freer hand in promoting his supporters and protégés from the Communist Youth League to important positions of leadership.

For many this meeting will also set the stage for further changes in October 2007 when the 17th party congress is scheduled to take place.

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