Bloomberg News

Merkel Boosts Wang’s Political Prospects With Guangdong Trip

February 05, 2012

(Updates with meeting in first paragraph)

Feb. 4 (Bloomberg) -- Wang Yang, the Communist Party chairman of China’s most populous province, got the chance to raise his profile ahead of the country’s leadership transition when he met today with German Chancellor Angela Merkel.

Wang has gained a reputation as a political and economic reformer during his four years in charge of Guangdong, the province with the largest economy in China that is one of the world’s biggest manufacturing centers and had a higher gross domestic product than Saudi Arabia.

A visit by Merkel gives Wang, 56, the chance to burnish his image after trying to push Guangdong’s economic focus away from exports and toward domestic services amid faltering global demand for the goods its factories produce. He met Merkel for breakfast in Guangzhou today according to a local foreign affairs official, who didn’t want to give her name.

Wang’s handling of the economy in Guangdong may help win him a spot on the party’s Politburo Standing Committee, said Hu Yifan of Haitong International Securities Group.

“Over the years, Wang has been aiming to move the low-end manufacturing sector up the value-added chain,” said Hu, chief economist and head of research at Haitong. “While it will take time for Guangdong to see significant improvement, I think Wang will make a very strong candidate for the standing committee.”

Pushing Limits

Guangdong, with a population of 104 million people, is where China set up the first special economic zones to attract foreign investment more than three decades ago. It is also home to some of the country’s most outspoken newspapers, which during Wang’s tenure have pushed the limits of state censors. Its GDP was 5.3 trillion yuan ($840.5 billion) in 2011.

“Thirty years ago when we started reform, it was mainly to get rid of the shackles of ideology,” Wang said at a provincial party meeting Jan. 4, the Guangdong-based Nanfang Daily reported the next day. “And now reform will have to break the constraints of the existing vested interests. If the direction of reform is decided by these interests, then reform cannot succeed.”

State-controlled media praised Wang for peacefully resolving an uprising in the fishing village of Wukan in December that went from standoff to a potential model for settling similar disputes in the future.

The Wukan protests saw villagers oust local leaders in a dispute over illegal land sales and election fraud. Regional officials under Wang gave concessions to residents, who held elections Feb. 1 for a committee that will oversee a ballot later this year to name new village leaders.

‘Strong Leader’

“Wang Yang scored very well for his handling of the Wukan incident,” said Li Cheng, who analyzes Chinese politics at the Brookings Institution in Washington. “Liberal intellectuals in China are increasingly considering Wang Yang as a strong leader to push for political reforms.”

The Communist Party holds a congress later this year that will pick the leaders to rule China for the next decade. Vice President Xi Jinping is forecast to get the top job as the party’s general secretary, while some other posts on the Politburo Standing Committee, now with nine members, have not been settled. Wang has been on the 25-member Politburo since after the last Congress in 2007, according to his official biography.

Like President Hu Jintao, whom Merkel met yesterday, Wang hails from eastern Anhui province, where he served in the early 1980s as a top official in the Communist Party’s Youth League, an organization headed by Hu from 1984-85.

Rises Through Ranks

After that post, Wang’s career took off. He became a vice governor of Anhui -- also the home province of Executive Vice Premier Li Keqiang, who is expected to succeed Wen as premier -- where he served through 1999. That year he moved to Beijing to become vice director of the country’s planning commission. In 2005, he became the Communist Party boss in the city of Chongqing, moving to the Guangdong post and the Politburo seat in late 2007.

Merkel’s meeting with Wang is interesting because he’s a promising candidate for the Standing Committee, a German government official told reporters on condition of anonymity because he wasn’t authorized to speak about the matter publicly.

Joerg Wuttke, the former head of the European Chamber of Commerce in China, said Merkel is going to Guangzhou, Guangdong’s capital, because of the “big German presence” in the city, which is also called Canton.

Guangdong Changes

“She’s obviously interested in how Guangdong wants to reform itself,” Wuttke said, pointing out that Germany faced similar challenges in transforming the Ruhr industrial region and East Germany.

Merkel arrived in Guangzhou yesterday, where she and Wen toured a Herrenknecht AG tunneling machine factory. Volkswagen AG Chief Executive Officer Martin Winterkorn, Siemens AG Chief Executive Officer Peter Loescher, and Lenovo Group Ltd. Chairman Yang Yuanqing were among executives attending business forum with Merkel and Wen.

Wen reiterated comments he made on Feb. 2 that China was willing to cooperate with Europe to overcome the financial crisis.

“Some people say this means China wants to buy Europe,” Wen said at the forum. “China doesn’t have this intention and doesn’t have this ability.”

Merkel’s visit may be a signal to party cadres that Wang has the support of top leaders for a higher position, said Wu Guoguang, a China specialist and professor of political science and history at the University of Victoria in British Columbia who has authored 20 books.

This visit “would help to highlight Wang Yang’s important position, thus would give a hint to party cadres to think that they should support Wang in public opinions and, at the future Party Congress, vote for him as he is a favorite of the supreme leadership,” Wu said.

--Michael Forsythe and Henry Sanderson, with assistance from Sophie Leung in Hong Kong and Patrick Donahue in Berlin. Editors: Nicholas Wadhams, Paul Tighe

To contact Bloomberg News staff for this story: Michael Forsythe in Beijing at mforsythe@bloomberg.net; Henry Sanderson in Beijing at hsanderson@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net


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