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THIS WEEK:

Xi urges high-quality development in Western China, return of the Beijing Auto Show, major restructuring of the PLA, new measures to finance high-tech, and severe floods in Guangdong.

1. Xi Urges High-Quality Development in Western China

What Happened: At an April 23 symposium in Chongqing on the development of Western China, Xi Jinping called for state-owned enterprises to boost investment in the region and urged vigilance in curbing illegal religious activities. 

Unbalanced Development: When China announced its Western Development Strategy in 1999, the West’s per capita income was only 40% of what it was in Eastern China. Substantial investment and new transport links helped close the gap, but huge disparities remain, and the West’s per capita income still lags at around 60% of the East’s.

The Emperor Far Away: Aside from the region’s remoteness and lack of development, other obstacles to Beijing’s ambitious plans to develop the West include personnel issues and conflict between Han Chinese and minority populations. The symposium was held a day after Han Yong, former head of the Xinjiang Production and Construction Corps, was expelled from the Party for “serious violations of discipline and law.”

Why It Matters: Xi's strategy to promote tourism and service industries in the West signals a more refined approach that highlights Beijing's emphasis on “tailoring new productive forces to local conditions,” but the region’s problems go far deeper.

By: Hongjia Yang, Former Affiliated Researcher, Center for China Analysis

Learn More: Take a closer look at the people, institutions, and networks behind China’s policymaking with the Center for China Analysis’s flagship Decoding Chinese Politics project.

2. Return of the Beijing Auto Show

What Happened: The biennial Beijing Auto Show is back after a four-year hiatus. The event runs through May 4 and features over 700 exhibitors.

The Buzz: With Beijing back on the global auto show calendar — the 2002 event was cancelled due to COVID — automakers and trade journalists were eager to take the pulse of the world’s largest car market. In 2023, more than 22 million cars were sold domestically, and China became the world’s largest vehicle exporter, shipping almost 5 million units.

A Global Marketplace: Major foreign automakers used the show as a platform to unveil their newest models as well as attention-getters like the first electric G-Class Mercedes and several bespoke Rolls-Royces. General Motors showcased its electric vehicle lineup — and not one traditional gas-powered car.

Why It Matters: China’s growing dominance in electric vehicles and batteries has sparked trade tensions and backlash from industrial economies. But politics took a back seat at the Beijing Auto Show, where the focus was on the cars — and bottom lines.

By: G.A. Donovan, Fellow for Chinese Political Economy and Society, Center for China Analysis

Learn More: Find out what the rapid growth of the Chinese auto industry means for the global automotive market in this discussion on China and the Rise of Electric Vehicles, co-hosted by the Asia Society Policy Institute and Washington International Trade Association.

3. PLA Announces Major Overhaul

What Happened: China unveiled a major restructure of its military, establishing a new “Information Support Force” and renaming other military branches.

The Details: The PLA dissolved the Strategic Support Force, which had been in charge of China’s space, cyber, and information capabilities, and replaced it with four new branches: the Aerospace Force, the Cyberspace Force, the Information Support Force, and the Joint Logistic Support Force.

The Explanation: A PLA press release stated that “the Information Support Force is a key support for coordinating the construction and application of network information systems and it will play a crucial role in advancing the Chinese military's competitiveness in modern warfare.” 

Why It Matters: The major overhaul suggests that there were deep-seated issues within the old Strategic Support Force. The new information support arm highlights the PLA’s emphasis on training and modernizing a force capable of executing “network-centric warfare” and joint operations, which require a high degree of cross-platform, real-time information sharing.

By: Lyle Morris, Senior Fellow on Foreign Policy and National Security, Center for China Analysis 

Learn More: Lyle wrote about the modernization of the PLA in What China’s New Central Military Commission Tells Us About Xi’s Military Strategy.

4. New Measures to Finance High-Tech

What Happened: On April 19, the China Securities Regulatory Commission (CSRC) announced new measures designed to help allocate more capital to the high-tech sector.

Harnessing Capital Markets: The CSRC’s Sixteen Measures to Facilitate the High-Level Development of Technology Enterprises are intended to harness private capital to serve national imperatives, directing investment to sectors strategically aligned with Xi Jinping’s overarching economic objectives and propelling China’s technological ambitions.

The Broader Picture: The new measures are an extension of the State Council’s “Nine-Point Guideline,” which aims to rein in speculative trading in China’s stock market and foster stable, long-term capital growth by encouraging value investing and a larger role for institutional investors.

Why It Matters: Politics is in command, and plans to revitalize China’s stagnant stock markets and bolster investor confidence are but means to harness Xi’s “new productive forces.” How the CSRC’s new measures benefit tech enterprises or affect market behavior will be worth watching. 

By: Lizzie C. Lee, Affiliated Researcher on Chinese Economy, Center for China Analysis

Learn More: Lizzi discussed Beijing’s technology ambitions in What Happened at China's Two Sessions in 2024?

5. Guangdong Ravaged by Flash Floods

What Happened: Torrential rain in Guangdong province caused severe floods resulting in significant damage and loss of life. Guangzhou and smaller cities Shaoguan and Heyuan were among the worst affected.

The Details: The floods claimed the lives of four people and another 10 remain missing. Local authorities estimated direct economic losses of nearly $20 million, although that will likely rise when the full extent of the damage is known.

The Delta: Situated in the low-lying Pearl River Delta, Guangdong has been prone to floods for centuries, but their frequency and severity has increased in recent decades due to rising sea levels and storm surges.

Why it Matters: The floods are another reminder of how the changing global climate poses an increasingly serious threat, and why Beijing needs to prioritize climate adaptation and resilience efforts — including comprehensive disaster prevention and response measures — to reduce its vulnerability.

By: Taylah Bland, Fellow on Climate and the Environment, Center for China Analysis

Learn More: Taylah explains why "China Will Accelerate Climate Resilience as a Security Priority" in China 2024: What to Watch.