Zhu Rongji

Zhu Rongji
朱镕基
Zhu Rongji in 2001
Premier of the People's Republic of China
In office 17 March 1998 – 16 March 2003
President	Jiang Zemin
Deputy	Li Lanqing
Preceded by	Li Peng
Succeeded by	Wen Jiabao
6th First-ranking Vice Premier of the People's Republic of China
In office 29 March 1993 – 17 March 1998
Premier	Li Peng
Preceded by	Yao Yilin
Succeeded by	Li Lanqing
Member of the 14,15th CPC Politburo Standing Committee
In office 19 October 1992 – 15 November 2002
General Secretary	Jiang Zemin
9th Governor of the People's Bank of China
In office July 1993 – June 1995
Premier	Li Peng
Preceded by	Li Guixian
Succeeded by	Dai Xianglong
Member of the National People's Congress
In office 25 March 1988 – 5 March 2003
Constituency	Shanghai At-large (88-93) Hunan At-large (93-03)
Personal details
Born	(1928-10-01) 1 October 1928 Changsha, Hunan
Nationality	Chinese
Political party	Communist Party of China
Spouse	Lao An
Children	Zhu Yunlai (son) Zhu Yanlai (daughter)
Alma mater	Tsinghua University
Profession	Electrical engineer
Signature	File:Zhu Rongji Sign.png

Zhu Rongji
Simplified Chinese	朱镕基
Traditional Chinese	朱鎔基
Transcriptions Standard Mandarin Hanyu Pinyin Zhū Róngjī Wade–Giles Chu Jung-chi Southern Min Hokkien POJ Chu Iûⁿ-ki

Zhu Rongji (pinyin: Zhū Róngjī; Wade–Giles: Chu Jung-chi; IPA: [ʈʂú ɻʊ̌ŋtɕí]; born 1 October 1928 in Changsha, Hunan) is a prominent Chinese politician who served as the Mayor and Party chief in Shanghai between 1987 and 1991, before serving as Vice-Premier and then the fifth Premier of the People's Republic of China from March 1998 to March 2003.

A tough administrator, his time in office saw the continued double-digit growth of the Chinese economy and China's increased assertiveness in international affairs. Known to be engaged in a testy relationship with General Secretary Jiang Zemin, under whom he served, Zhu provided a novel pragmatism and strong work ethic in the government and party leadership increasingly infested by corruption, and as a result gained great popularity with the Chinese public. His opponents, however, charge that Zhu's tough and pragmatic stance on policy was unrealistic and unnecessary, and many of his promises were left unfulfilled. Zhu retired in 2003, and has not been a public figure since. Premier Zhu was also widely known for his charisma and tasteful humour.

Early life and career

Zhu Rongji was born in Changsha, Hunan, to a family of intellectuals and wealthy landownders. According to family tradition, his family was descended from Zhu Yuanzhang, the first emperor of the Ming dynasty. His father died when he was born, and his mother died when he was nine. Zhu was subsequently raised by his uncle, Zhu Xuefang, who continued to support Zhu's education.

Zhu was educated locally, and after graduation from high school he attended the prestigious Qinghua University in Beijing. While attending Qinghua he became a student leader and took part in activities that were organized by the Communist Party. He graduated with a degree in electrical engineering and joined the Communist Party of China in 1949, the same year that the Communists captured Beijing, ended the Chinese Civil War, and declared the beginning of the People's Republic of China. In 1951 he became the chairman of the Qinghua Student Union.

Following his graduation, Zhu began his career as a civil servant. He began his career in the Northwest China Ministry of Industries, where he was appointed the deputy head of its production planning office. From 1952-1958 he worked in the State Planning Commission, where he worked as group head, deputy director, and deputy section chief. In 1957, during the Hundred Flowers Campaign, he criticized Mao Zedong's economic policies, saying that they promoted "irrational high growth". His comments led to him being subsequently identified as a "rightist" in 1958, for which he was persecuted, demoted, disgraced, and thrown out of the Communist Party. In the late 1950s his family was also persecuted for their pre-revolutionary status as wealthy landowners, and their family mansion was destroyed.

After his persecution as a rightist, Zhu was sent to work at a remote cadre school. In 1962, following the famine and industrial collapse caused by the Great Leap Forward, Zhu was pardoned (but not politically rehabilitated), and was assigned to work as an engineer at the National Economic Bureau of the State Planning Commission. During the Cultural Revolution Zhu was purged again. From 1970-1975 he was sent for "re-education" to the "May Seventh Cadre School", a special farm for disgraced government workers and former Party members. During his exile in the countryside Zhu worked as a manual laborer, raising pigs and cattle, carrying human waste, and planting rice.

Shortly after the death of Mao Zedong in 1976, Deng Xiaoping helped to rehabilitate Zhu, and he returned to work in the government. From 1976 to 1979 he work as an engineer in the Ministry of Petroleum Industry, and seved as the director of the Chinese Academy of Social Sciences' Industrial Economic Bureau. In 1978 he was formally rehabilitated and allowed to rejoin the Communist Party. During the late 1970s Zhu's positions were relatively low-profile, but after Deng consolidated his power in the 1980s, Zhu was promoted to work in increasingly demanding positions. Since he had few connections in the army, the Party, or the bureaucracy, he was able to rise through the ranks of the government mostly through his own skills. In 1979 he was reassigned to the State Economic Commission, in which he served as vice-minister from 1983-1987.

After being politically rehabilitated and re-entering the civil service, Zhu resumed connections with his alma mater, Qinghua University. In 1984 he was named the dean of Qinghua University's School of Economics and Management. He held his position as dean at Qinghua for seventeen years, throughout most of his subsequent public career. As he became increasingly able to meet and make connections with foreign academics and world leaders, he was able to promote a close academic relationship between Qinghua and M.I.T. Later in his career he gained a reputation for lecturing subordinates, a habit that observers interpreted as being a product of his position as an educator at Qinghua.

Zhu (second left) leading the Chinese delegation at the European Management Forum in 1986

Mayor of Shanghai

In 1987 Zhu was promoted to work as the mayor of Shanghai, which was then China's largest, most industrially developed, and wealthiest city. During Zhu's term as mayor of Shanghai he oversaw large, rapid improvements in telecommunications, urban construction, and transportation, especially in Pudong, a large and high-profile Special Economic Zone.

It was during his time as Mayor of Shanghai that he developed a public reputation as a strong opponent of corruption, and as a talented economic reformer. His efforts to simplify the process by which the government approved business deals earned him the nickname "One-Chop Zhu". In order to improve relations with the foreign business community and solicit outside advice, he formed an advisory committee composed of foreign businessmen. It was during Zhu's time in Shanghai that he began his long working relationship with Jiang Zemin, which continued throughout Zhu's career.

He also became known during this time for his strict adherence to law and Party discipline, and for his refusal to grant extrajudicial favours to those close to him. Once in 1988, when some family members asked him over dinner if he could bend China's residency laws to allow them to move to Shanghai, he turned them down, responding: "What I can do, I have done already. What I cannot do, I will never do."

In 1989, when large-scale protests broke out in numerous cities around China, there were also large, well-organized protests in Shanghai. Unlike the government's violent crackdown of protesters in Beijing, Zhu was able to peacefully resolve the local situation. At one point a group of protesters derailed and burnt a train, for which several participants were arrested and executed, but there was otherwise little loss of life, and Zhu was able to retain significant public sympathy throughout the event.

Although he demonstrated a desire and ability to enact large, thorough legal and economic reforms, and political reforms aimed at making the Chinese government more efficient and transparent, Zhu made it clear that he did not support dramatic political change. When asked by Western journalists in 1990 whether he was China's Gorbachev, he responded "No, I am China's Zhu Rongji".

Vice Premiership

In 1991, largely due to his success in managing the development of Shanghai, Zhu was promoted into the central government in Beijing, where he focused on planning and resolving economic projects and issues as the vice-premier of the State Council and the director of the State Council Production Office. He also served concurrent terms as the governor of the central bank, overseeing monetary policy. His first issues after arriving in Beijing were to restructure the debts owed by state owned enterprises, and to simplify and streamline the process by which farmers sold their grain to the government. Zhu was able to enact relatively far-reaching reforms largely via the broad support of Deng Xiaoping, who noted that Zhu "has his own views, dares to make decisions, and knows economics." In comparing Zhu to his peers when considering his appointment, Deng said, "The current leadership do not know economics... Zhu Rongji is the only one who understands economics."

When a global recession occurred in 1992, China was challenged with excessive investment in fixed assets, excessive monetary supply, rapid inflation, and chaotic financial markets. As the director of the central bank and the vice-premier and head of the State Council Economic and Trade Office, Zhu resolved these issues by limiting monetary supply, eliminating duplicate low-tech industrial projects, devaluing the Chinese currency, cutting interest rates, reforming the tax system, and investing state capital in the transportation, agricultural, and energy sectors. Following Zhu's management, the Chinese economy was able to maintain stable growth and avoid dramatic price fluctuations. Zhu's ability to stabilize the economy led to his being named to the CPC Standing Committee in 1993, after which he also retained his other posts. That many

Zhu's most active opponent of his plans to reform the Chinese economy was Premier Li Peng. Peng and Zhu clashed in the first two years following Zhu's appointment as vice-Chairman; but, by the time that he suffered a heart attack in 1993, Li had lost influence within the government and was no longer able to block many of Zhu's reforms.

Zhu once used the term "patriotic organizations" in a speech in the mid-1990s to describe the triads, citing their past history as secret societies in resisting foreign invaders and playing a key role in Chinese history.

Premiership

Zhu was chosen to become China's fifth premier in 1998, largely due to his success in managing large macroeconomic projects. During his term Zhu continued to focus on issues related to economic development. He generally favoured stable, sustainable development supported by robust macroeconomic control measures and a tight monetary policy. He continued to promote investment in China's industrial and agricultural sectors.

Early in his term he began a programme of privatization that lasted throughout his period in office, during which China's private sector experienced rapid growth. He responded to the 1997 Asian financial crisis by dramatically reducing the size of the state bureaucracy. His subsequent reform of state-owned enterprises led to approximately forty million workers being laid off. During the crisis he refused to devalue the Chinese yuan, and angrily defended his decision when some international leaders suggest that he do so.

Zhu introduced limited reforms in China's housing system, allowing residents to own their own apartments for the first time at subsidized rates. He was successful in reducing the size of the official bureaucracy by half by the end of his term in 2003, though the bureaucracies in districts far from the capital continued to expand, leading to increased tension between some local governments and the farmers whose income supports them.

Zhu earned a reputation as a strong, strict administrator, intolerant of corruption, nepotism, or incompetence. In Beijing he was sometimes known by the nicknames "Madame Zhu" and "Boss Zhu" for his hard, transparent work ethic and his tendency to disregard the bureaucratic status quo. He took the lead in negotiating China's entry into the World Trade Organization, which the country achieved in 2001 to domestic and international acclaim. Joining the WTO opened China to increased foreign investment, but also required it to conform to international conventions of trade, intellectual property, and environmental management. Zhu himself did not view China's entry into the WTO as a tool to achieve international economic hegemony, but more as a tool to force economic and legal change within China.

Among the international leaders he met and negotiated with as premier, he gained a reputation for intelligence, energy, impatience for incompetence, shrewdness, and as a person who must be respected, even among those who disliked him. Journalists noted his proficient command of English and his "disarming" sense of humor.

After becoming premier he worked on attracting and promoting economists and technocrats from academia and the private sector to work under him as advisors in the central government. During his premiership he was successful in attracting a small core of several dozen such officials to work under and advise him. At one time he was reported to have read 16,000 letters a year, sent to him by aggrieved citizens.

During his term as premier Zhu engaged in frequent large-scale efforts to fight official corruption. He made frequent official visits outside Beijing to inspect working conditions, especially in the south. Shortly after coming to office, in 1998, he required the People's Liberation Army to relinquish its involvement in business interests that had been making high-ranking officers and their children rich, and later barred civil servants from taking part in business enterprises. He attempted to introduce stricter, more formal oversight to keep provincial leaders from receiving kickbacks from businessmen and embezzling state funds.

Zhu's investigations into official corruption led to his discovery of numerous large-scale misdeeds by provincial officials. After discovering that 25.8 billion RMB allocated for the purchase of grain over six years had gone missing, he launched an investigation which concluding that at least 10 billion RMB had been instead used to construct hotels, luxury apartments, and on speculative business investments. In one inspection tour in 2001, Zhu uncovered the largest corruption ring in modern Chinese history, discovering that many high-ranking officials in Fujian had conspired to operate a massive smuggling ring. In the resulting purge, numerous top-level Party leaders and governors were arrested and executed. On one inspection tour, after noticing that dikes had broken because funds allocated to their proper construction had been stolen by corrupt officials, he flew into a rage over such "son-of-a-bitch construction projects", which were not uncommon in China at the time. Referring to his efforts to fight corruption, he once said, "I will prepare 100 coffins for the corrupt, and one for me, for I will die of fatigue". Much of his efforts to increase the role of the private market in the economy, to improve legal protection for businesses, and to introduce a true commercial banking system were implicitly undertaken in the interest of reducing the kind of official corruption and waste that he uncovered through his personal investigations of government officials.

The 1990s were a difficult time for economic management, as unemployment soared in many cities, and the bureaucracy became increasingly tainted by corruption scandals. Zhu kept things on track in the difficult years of the late 1990s as China averaged growth of 9.7% annual for the two decades leading up to 2000. Against the backdrop of the Asian financial crisis (and catastrophic domestic floods) mainland China's GDP still grew by 7.9% in the first nine months of 2002, beating the government's 7% target despite a global economic slowdown. This was achieved, in part, through active state intervention to stimulate demand through wage increases in the public sector among other measures. China was one of the few Asian economies that survived the crisis.

While foreign direct investment (FDI) worldwide halved in 2000, the flow of capital into mainland China rose by 10%. As global firms scrambled to avoid missing the China boom, FDI in China rose by 22.6% in 2002. While global trade stagnated, growing by one percent in 2002, mainland China's trade soared by 18% in the first nine months of 2002, with exports outstripping imports.

Despite the glowing growth statistics, Zhu tackled deep-seated structural problems: uneven development; inefficient state firms and a banking system mired in bad loans. Observers contend that while there are few substantial disagreements over economic policy within the CPC; tensions tend to focus on the pace of change. Zhu's economic philosophies had often triumphed over those of his colleagues, they nevertheless resulted in a testy relationship with then-General Secretary Jiang Zemin.

The PRC leadership struggled to modernize State-owned enterprises (SOEs) without inducing massive urban unemployment. As millions lost their jobs to closing state firms, Zhu demanded financial safety nets for unemployed workers, an important aim in a country of 1.3 billion. Under the auspices of Zhu and Wen Jiabao (his top deputy and successor), the state tried to alleviate unemployment while promoting efficiency, by pumping tax revenues into the economy and maintaining consumer demand. Zhu also won acclaim domestically and internationally for steering the People's Republic of China into the World Trade Organization (WTO) in 2001.

Zhu, along with his successor Wen, sought to protect farmers from indiscriminate taxation by corrupt officials by setting limits on taxes. Well respected by many Chinese citizens, Zhu has also garnered the respect of prominent Western political and business leaders, many of whom credit Zhu with engineering China's market-opening and ascension to the World Trade Organisation (WTO), which has brought foreign capital pouring into the country.

Zhu's premiership and management of the economy was controversial. He retired from his position as premier in 2004, when he was replaced by Wen Jiabao. Wen was the only Zhu ally to appear on the subsequent nine-person Politburo Standing Committee. Though Wen has since earned a reputation as a competent administrator known for his suppleness and discretion, similar to his fourth-generation colleague Hu Jintao, observers have cited Wen's personal opinions as difficult to discern in contrast to his relatively outspoken predecessor.

During the 2000 ROC presidential election in Taiwan, Zhu predicted "no good ending for those involved in Taiwan independence". In his farewell speech to the National People's Congress, Zhu unintentionally referred to China and Taiwan as two "countries" before quickly correcting himself. His stance on Taiwan during his time in office was always with the Party line.

Contributions to State Capitalism

Zhu and Deng's vision of China's future was not just rapid growth but continuous reform. There were two major endeavors to Zhu's reformist campaign. First was to rationalize and centralize the fiscal and financial system. Second was to streamline and strengthen the state sector.

As to accomplish both of his missions, his first goal was to regain central control over the country's burgeoning yet dangerously decentralized tax revenues. As a result, he went in person to each province in China to sell a new "tax sharing" idea modeled on the U.S. federal tax system. Under this new policy, revenue from provinces would go first to Beijing, and then the other portions will be returned to the provinces. Therefore, the central government's cut of total revenue increased by over 20 percent in a single year, balancing the central budget and putting Beijing's resources on track to increase dramatically in the years to come. Also, he appointed himself governor of the People's Bank of China with jurisdiction over monetary policy and financial regulations to bring the highly decentralized banking system more closely under Beijing's control.

Next was to clean China's four colossal state-owned banks of billions of dollars in nonperforming loans accumulated due to profligate local lending to unprofitable SOEs. He quarantined these bad loans in newly created "asset-management companies", and recapitalized the banks through government bonds in a restructuring strategy. After his promotion to premier in 1998, Zhu saved the biggest SOEs and allowed thousands of other small and medium-sized firms and factories to go under, assuming that new growth in the private sector could alleviate any surge of unemployment, resulting in millions of workers to lose their "iron rice bowl" guarantees of cradle-to-grave employment, health care benefits, and pensions. Instead, Zhu challenged free managers to base salaries on performance and market competitiveness and made profitability and productivity as determining factors in managerial and executive promotions.

All these economic reform efforts by Zhu was not to dismantle the state sector, but to streamline it and accomplish Deng's new form of marketized socialism. Although the West may have been skeptical when Deng announced that he would pursue "socialism with Chinese characteristics," Zhu had actually proved to mean something: growing wealth and power for the nation-state under the firm grip of the Communist Party.

Personal life

Zhu Rongji and his wife, Lao An (1956)

Zhu Rongji has been recognized as a good public speaker and was notable during his career for his proficient command of English. He often made public speeches without the aid of a script, but when he did so his speeches were said to be entertaining.

He enjoys literature, and has reportedly spent much of his retirement reading books he had no time to read while in office. He plays the erhu, an instrument similar to a two-stringed violin. He enjoys Peking Opera, and once appeared on stage as an actor in a performance.

His wife, Lao An, once served as the vice-chairman on the board of directors of China International Engineering and Consulting. She and Zhu attended two schools together, first at the Hunan First Provincial Middle School, then at Qinghua University. They have two children, a son and a daughter. Their son,Zhu Yunlai, was born in 1957. He was once the president and chief executive officer of one of China's most successful investment banks, China International Capital Corp. His daughter is Zhu Yanlai, who was born in 1956.

Legacy

After Zhu retired, some of his reforms were reversed under the leadership of Hu Jintao, and other reforms he hoped would be addressed by the incoming administration were not implemented. Notably, state-owned enterprises were allowed to regrow and re-establish a dominant place in the Chinese economy, and large sectors of the banking sector remain unregulated. Hu may have reversed the Chinese government's previous position and promoted state-owned enterprises in an effort to promote social stability.

After his retirement, Zhu withdrew from any obvious involvement in Chinese politics, but he retained ties with Qinghua university, where he made numerous visits during ceremonies and special events. In 2014, he wrote a rare public letter for the 30th anniversary of Qinghua's School of Economics and Management, but was not able to attend due to poor health. In the letter, he encouraged the students at the prestigious business school to visit poor and rural areas of China, in order to better understand the conditions of most Chinese people.

Since he left office Zhu wrote, and has been the subject of, numerous books. Zhu's first book, Zhu Rongji Meets the Press, a collection of speeches and interviews with foreign and Chinese journalists and officials, was released in 2009 (an English translation of the book was released in 2011). A second book, Zhu Rongji's Answers to Journalists' Questions, a four-volume compilation of Zhu's speeches, articles, and letters, was also released in 2011. The second book was translated and published in English in 2013, under the title: Zhu Rongji on the Record: The Road to Reform, 1991-1997. One Western biography of Zhu encouraged leaders in other developing countries to study and emulate his reforms, and compared his influence on practical economic theory to that of Keynes.

After retiring, Zhu invested much of his time and energy into public philanthropy, in 2013 and 2014 alone donating 40 million RMB (c.$6.5 million US) to charity. The donated money reportedly came from the royalties from his books, and was given to a charitable foundation promoting education in poor rural areas. The amount of money given was considered unusual among retired Chinese politicians, leading to speculation about Chinese political culture. The donations prompted some commenters to compare his character to that of China's first premier, Zhou Enlai.

After his retirement some economists noted that Zhu had been noticeably more popular and talented at economic management than his predecessor, Li Peng. Zhu, a competent manager and a skilled politician, ran into various roadblocks during his tenure because of the attitude of General Secretary Jiang Zemin. Critics charge that Zhu made too many "big promises" that were unable to be achieved during his term in office.

Zhu is widely remembered in China for his determination to fight official corruption during his later years in office, saying: "I'll have 100 coffins prepared. Ninety-nine are for corrupt officials and the last one is for myself." Despite his efforts, the extent to which he was successful in containing official corruption during his tenure has been questioned by modern China observers. One of his proteges, Wang Qishan, later became the head of China's Central Commission for Discipline Inspection, the government's main office in charge of investigating internal corruption.

See also

• History of the People's Republic of China (1989–2002)
• Macroeconomic regulation and control
• Politics of the People's Republic of China
• Premier of the State Council of the People's Republic of China

Bibliography

• "The Man Who Took on the Dissidents: Li Peng (1928–)" CNN.com. 2001. Retrieved 21 August 2008.
• Dumbaugh, Kerry and Michael F. Martin. Understanding China's Political System. Congressional Research Service. December 31, 2009. Retrieved on July 14, 2015.
• "What He Did, and Left Undone: The Mixed Legacy of Zhu Rongji, China's Outgoing Prime Minister". The Economist. March 6, 2003. Retrieved on July 14, 2015.
• LaMoshi, Gary. "The Mystery Behind Zhu's Miracle". Asia Times Online. February 22, 2003. Retrieved July 14, 2015.
• Lee, Khoon Choy. Pioneers of Modern China: Understanding the Inscrutable Chinese. Singapore: World Scientific Publishing. 2005. ISBN 981-256-464-0. Retrieved on July 14, 2015.
• Mackerras, Colin, Donald Hugh McMillen, and Donal Andrew Watson. Dictionary of the Politics of the People's Republic of China. Great Britain: Routelage. 1998. Retrieved 4 November 2011.
• McCarthy, Terry. "Zhu Rongji's Year of Living Dangerously". TIME. April 12, 1999. Retrieved on June 14, 2014.
• People's Daily. "Zhu Rongji--Premier of the State Council". En.people.cn. Retrieved on July 14, 2015.
• Pesek, Willie. "China Needs Another Zhu Rongji". The Japan Times. Retrieved July 14, 2015.
• Song, Yuwu. "Zhu Rongji (1928-)". Biographical Dictionary of the People's Republic of China. United States of America: McFarland & Company. 2013. ISBN 978-0-7864-3582-1. Retrieved on July 14, 2015.
• Wang, Yue. "Report:Zhu Yunlai, Son Of Former Chinese Premier Zhu Rongji, Leaves CICC". Forbes. September 13, 2015. Retrieved July 14, 2015.
• Weatherley, Robert. Politics in China Since 1949: Legitimizing Authoritarian Rule. New York, NY: Routelage. 2006. ISBN 978-0-415-39109-2. Retrieved on July 14, 2015.
• Yu, Jess Macy. "Former Chinese Premier Draws Praise for His Philanthropy". The New York Times. February 23, 2013. Retrieved July 14, 2015.
• Zhang Hong. "Former Chinese Premier Zhu Rongji Breaks Long Silence with Letter to University: Rare Gesture from Ex-Party Leader Offers Glimpse of His Health and State of Mind". South China Morning Post. April 29, 2014. Retrieved July 14, 2015.

External links

• Profile at China Vitae
• Appearances on C-SPAN
• Zhu Rongji collected news and commentary at The New York Times