Challenges for the fourth generation: the RIAP Emerging Voices Project uncovered some top young talent around the region, all of whom were asked to write an essay on the topic of generational change in Asia. The competition's second winner, Sarah Hill, chose to tackle the vexing problems facing China's next generation of leaders - RIAP Emerging Voices Project - Research Institute for Asia and the Pacific

Business Asia, April, 2003 by Sarah Hill

Hu Jintao's succession to the presidential seat in Beijing, November 2002, signals the start of a generational changeover in China and in Asia generally. Over the next decade, China's "fourth generation" leaders, those now in their forties and fifties, will make their way into the highest ranks of government ministries, financial institutions, think tanks and business networks.

Political and economic analysts are watching this period of transition not without a little apprehension. Over the past 20 years, dazzling economic growth in China has made it a rich and powerful nation, a new heavyweight in the global economic order. China's economy doubled in the 1980s and then doubled again in the 1990s. According to reports such as the Department of Foreign Affairs and Trade's China Embraces the World Economy, China is now set to outstrip the United States to become the world's largest national economy sometime in the 2030s.

Danger

Yet there remains a certain amount of danger associated with China, The devastation inflicted upon China's people by the Cultural Revolution and the horror of the 1989 Tiananmen Square incident are still vivid collective memories for many in China and around the world.

For the West, China is also a perplexing problem ideologically as its new wealth has challenged the presumption that a capitalist democracy is the best formula for economic success; instead, China has retained its communist political system (even if it is a spurious form of communism), and nurtured its own ways of doing business, inscrutable to many a Western eye, to achieve its current state of prosperity.

For outsiders, this has resulted in an economic regime that is opaque and unpredictable. It is a more informal system of business based on inside knowledge and on a highly cultivated use of guanxi and personal networks. This, on top of the language and cultural barriers, means that conducting business in China can be a very risky proposition. The coming of a new generation of Chinese leaders who are more globally aware, of whom many have been educated in the West, means China's old ways could change.

So, whether the fourth generation will do business differently, especially now China has joined the World Trade Organisation (WTO) and formally opened its doors to global business, is a question many an analyst is anxiously trying to answer.

Gradual change

Amongst the many theories concerning China's future trajectory, the most hopeful one is that the fourth generation will gradually bring in political and economic reforms such as the rule of law, improved public and corporate governance, better fiscal transparency, and the regulation of accounting and banking procedures. Essentially, this theory is based on the argument of convergence, the idea that China and indeed many Asian countries will over time gravitate towards the liberal democratic norms and structures espoused in the West.

Shaky ground

Hopes for such a course, however, may rest on shaky grounds The fourth generation may not be the generation to readily embrace a structural overhaul of its political and economic systems. To truly gauge the mettle of China's fourth generation leaders, it is essential to look at the life experiences and the historical context that have shaped their values and perspectives, and that will ultimately determine policy and practice.

This generation grew up under Mao Tse-Dong's China. They lived through the Cultural Revolution, and as young people, spent their time fighting zealously for Mao Tse-Dong's communist vision. Displaced by the upheavals, many of them ended up living under extremely harsh conditions in rural China. Yet the Revolution they had risked their lives for eventually threw their country into turmoil, chaos and starvation, and the experience of this horror totally shattered the belief systems of this cohort.

Having lived through such a brutal revolution and then having watched the bloody clamp down at Tiananmen Square, the fourth generation has had enough of radical political change. If Hu and his contemporaries are to introduce institutional reforms they will be nothing but gradual. Furthermore, any impulse towards a swift unleashing of free-market forces and the instituting of a democratic regime in China has been strongly dampened, if not extinguished, in light of Russia's disastrous experiment with democracy.

Mistrust

Yet the experience of national hardship for the Chinese also extends further back than the Cultural Revolution. Defeat in the Opium Wars 150 years ago and the experience of foreign exploitation during Great Britain's pursuit of a colonial empire left China with a severe loss of pride and a distrust of the West and any "gifts" it comes bearing. After the past century of harsh historical experience, confidence has really only flowed back into China as a result of its economy undergoing this recent period of high growth.

This revitalisation of traditional cultural principles for China is manifested most significantly in the revival of Confucianism. Classic Confucian values include rule of man rather than rule of law; obedience to a strict code of rituals and hierarchy; and authoritarian patterns of leadership. These doctrines profoundly clash with a Western liberal democratic philosophy enshrining principles such as the rule of law, equality and all the civil and political liberties (freedom of information, expression and assembly) that allow a dialogue between governing and governed.