China's Two Sessions in 2023:

Solidifying Xi Jinping-Centered-System and Driving a Multipolar International Order

Chung Jae-hung

jameschung@sejong.org

Research Fellow

The Sejong Institute

   In March, President Xi Jinping was re-elected as President of China and of the Chinese Military Committee with the unanimous approval of all participants in the National People's Congress, winning his third consecutive term for the first time in history. In both committees held after the 20th Party Congress last year, President Xi succeeded in serving three consecutive terms, Xi-Liqiang order has been launched, which can be summarized as a party gaining more control over technology and finance. In the past, the Party only had authority in human resources and supervision, and the actual administration was conducted by the State Council of China, whereas now, reorganization of human resources and composition of the organization by Xi Jinping-centered government to take control over the party and the government. Through this, a more integrated and unified Xi Jinping-centered government system was organized as the party-led state and administrative agencies were reorganized into a system centered on Xi Jinping.

In the two meetings, Xi Jinping's government announced it would participate in solving various economic and social problems in China by suggesting the expansion of domestic demands and foreign capital, advanced reformation of state-owned enterprises, changes in economic development methods, preventing financial risks, and guaranteeing basic livelihoods. In particular, China's economic growth rate has drawn the most attention internally and externally, is around 5%, the lowest since 1994 in the aftermath of the Zero-Covid Policy, showing the difficulties in the Chinese economy. Of course, economic growth is expected to be over 5% as the Zero-Covid policy was abolished and resumption of domestic and international economic activities in March, but challenges such as full hegemony conflict with the U.S. and worsening global economy due to the war in Ukraine, stagnant domestic market and real estates are not an easy task to solve. Nevertheless, under the principle of developing the state-owned economy and private economy, which are "two unshakable principles," the plan is to continue the development of Socialism with Chinese characteristics by advancing state-owned enterprise reformation, enhancing competitiveness, and protecting private corporate property and entrepreneurial rights. Therefore, China plans to actively respond to and solve various internal and external challenges such as U.S.'s semiconductor export regulations and decoupling policies, and to establish a new Central Finance Committee, Central Science and Technology Committee, and Central State Council of Hong Kong and Macao.

Despite Western sanctions against Russia over the current war in Ukraine, trade between China and Russia surpassed $190 billion in 2022, up 116% from 10 years ago, and is expected to surpass $200 billion within this year. China has already established itself as Russia's largest trade-economic partner for 13 consecutive years, and China and Russia plan to expand and develop economic cooperation between the two countries through a statement on the development plans for China-Russia economic cooperation in 2030 and expansion to the Eurasian regional community. In particular, the joint statement about China and Russia's economic cooperation was announced through China-Russia Summit, marking payment and its methods used in bilateral trade, investment, and loans between China and Russia has been agreed to use Russian Ruble and Chinese Yuan up to 2/3. In the future, Russia and China agreed to expand the use of their currency in settlement and trade in ASEAN, Central Asia, South America, the Middle East, and Africa through close financial cooperation.

After the war in Ukraine and the U.S.-China conflict, China pursued to expand its influence in a multipolar international order led by Russia to integrate the Eurasian region by i) economic-security strategic cooperation between China and Russia, ii) integration of China, Russia-centered integration of Eurasian countries, iii) Chinese industrial capitalism to overcome America's financial capitalism through "Belt and Road Initiative", and "Global Development Initiative."

Therefore, unlike past simple bilateral relations and approaches, Korea needs a more strategic and flexible balanced perspective in the future following the rapidly changing international situations. If three-party talks between South Korea, Japan, and the U.S. or Korea-U.S. alliance are to be the main strategy to solve North Korea's nuclear crisis or anti-China policy line, it is likely to trigger cooperation between North Korea and China, or North Korea, China, and Russia's integration. In other words, it is necessary to seek cooperative multilateralism and cooperative security such as the four-party and six-party talks to prevent the expansion of exclusive multilateralism that excludes certain countries. As a result, South Korea also needs to objectively realize the rapidly changing international and regional order changes, and seek balanced foreign policies that are not biased toward either side, along with a bold shift in perception to improve relations with China, Russia, and North Korea.