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Asian Cover -- Policymakers
CHINA'S ZHU RONGJI (int'l edition)
If China has managed to avoid the worst of Asia's crisis so far, Zhu Rongji may be the reason. In 1993, as China's vice-premier, he saw a crisis in the making. Banks were lending recklessly. A property bubble was forming in major cities. And speculation was rife on the stock markets. In hindsight, these were problems plaguing many Asian economies. Zhu choked off credit and took over management of the central bank. If other bank officials didn't shape up, he warned, he'd "chop off their heads."
Even those who found Zhu's tactics heavy-handed then regard him as a visionary now. Named China's premier last March, Zhu, 69, has avoided devaluing the currency, a move that could trigger more turmoil across Asia. Instead, he hopes to stimulate China's economy by pumping $250 billion into public works this year alone. Zhu's associates call him The Boss. His detractors call him The Madman for pushing ahead with high-risk policies despite fierce opposition. These days, he is making enemies by trying to cut half of all civil service jobs.
Born in Hunan province, Zhu comes from humble beginnings. His parents died when he was young. Raised by an uncle, he studied electrical engineering at Qinghua University. Critical of Maoist economics, Zhu was twice branded a rightist and sent to the countryside for hard labor in the '50s and '70s.
But Zhu's star soared after Deng Xiaoping ushered in reforms. In 1988, he became Shanghai mayor and invested heavily to restore the city as China's business hub. A year later, Zhu calmed student protests with a televised address--a sharp contrast with the bloodbath in Beijing. As economic czar in the 1990s, he cooled China's overheated economy, improved the tax system, and started modernizing banks that had been doling out loans to favored state enterprises.
Wherever Zhu travels, he speaks out on China's economic ills. One day, he's at a Beijing machine-tool factory to discuss worker layoffs, and the next, he's in Anhui province, urging grain companies to improve their services. Many analysts doubt he can meet his pledge to revamp the state sector and commercialize public housing in three years. And with China's rising unemployment, slowing foreign investment, and growing pressure to devalue because of the plunging yen, Zhu could come under attack again if he slips up. But thankfully for China, he has so far managed to stay on top.