The Wall Street Journal
Bob Davis
April 19, 2013
Ever since Xi Jinping formally took office as president in March, foreign officials have been trying to figure out who would be the Chinese government’s main liaison on economic issues. That was the role played during the past few years by Politburo member and Vice Premier Wang Qishan, who had deep experience in financial and economic issues and broad contacts with Western officials.
Mr. Wang represented China in negotiations with Treasury secretaries and finance ministers, who counted on him to explain China’s thinking on economic issues and to explain their views in the highest council’s of Beijing. But after the 64-year-old was promoted to the Politburo Standing Committee, China’s ruling body, and given the portfolio of rooting out corruption, he was considered too senior to negotiate any longer with a U.S. Treasury Secretary. Essentially, he was promoted out of his job.
After some weeks of indecision, China has appointed a new vice minister, Wang Yang, to the role of interlocutor. This Mr. Wang is best known as the reform-minded party secretary of Guangdong province, the export powerhouse next to Hong Kong, where he pushed what he called economic “transformation”—the remaking of low-end exporters into higher-value companies – and demonstrated a relatively light hand politically.
He didn’t call out the cops to break heads when automobile workers struck foreign car makers in 2010. He also defused a revolt in the village of Wukan over land grabs by Communist Party officials by allowing a local election for new leaders—though Wukan residents these days complain they still haven’t been fairly treated by party bigwigs.
The choice of Wang Yang was noted during U.S. Secretary of State John Kerry’s recent visit to China, though little noticed. China announced Mr. Wang would represent China on economic matters in an annual series of negotiations with the U.S. known as the Strategic and Economic Dialogue. Mr. Wang’s portfolio includes trade and agricultural issues and he has met in recent weeks with trade delegations from Japan, Canada and Thailand.
While foreign officials say they are happy with Mr. Wang because of his reformist credentials and because at age 58 he has a chance to go on to a more senior post in a second term under Mr. Xi. Like Wang Qishan, the younger Mr. Wang could rise from the Politburo to the ruling Politburo Standing Committee.
But there are big differences between the two. As vice premier, Wang Qishan had responsibility for economic and financial matters. Wang Yang is in charge of trade, but finance comes under the purview of another vice minister, Ma Kai, said a Western official.
Wang Qishan had deep personal ties with U.S. officials. Former Bush administration Treasury Secretary Hank Paulson knew Mr. Wang from his days as head of Goldman Sachs and considers the Chinese official to be a friend. Mr. Wang sometimes sent birthday presents to the father of the Obama Treasury secretary, Timothy Geithner. The senior Mr. Geithner was head of the Ford Foundation in China during the late 1980s and funded some of Mr. Wang’s studies.
The new Wang lacks these contacts and also lacks his predecessor’s deep knowledge of how the Beijing bureaucracy works. One Western official said that may not matter so much because Chinese Premier Li Keqiang is likely to play a more powerful role running the Chinese economy than his predecessor, Wen Jiabao, did, leaving less running room for Wang Yang.
Also Wang Qishan remains in a very powerful position. The most important economic policy issues are decided by the seven- member Politburo Standing committee – and sometimes by a smaller number of members who experience in a policy area. Wang Qishan is still on the must-see list for visiting dignitaries and, Western officials believe, is bound to play a role in top economic decisions.
