When he was the Chinese Communist Party boss in Shanghai, Li Qiang climbed into the driver seat of a Tesla Model 3 beside Elon Musk, who drew a smiley face on car’s display screen to match Li’s wide grin.
For Li, who had only recently taken charge of the leading financial hub, the American automaker’s decision to open a factory in Shanghai was a win for a national policy of promoting technological innovation in electric vehicles.
Within months, the huge popularity of cheaper made-in-China Model 3s among local buyers would ignite a wave of investment interest in finding the “Chinese Tesla.” Fierce competition between rivals like Nio, Xpeng and BYD ensued. Sales of electric cars skyrocketed.
When the 63-year-old is confirmed as premier by China’s rubber-stamp parliament on Saturday, he will be expected to repeat a similar feat on a national scale. Tasked with ensuring economic dynamism, one of Li’s top priorities is to soothe investor unease after the three years of turbulence from covid lockdowns and political crackdowns on entrepreneurs and industry.
Li has a track record of working with private business. But experts of Chinese politics widely hold he was chosen for the role primarily because of his long-standing personal relationship with Xi Jinping, the most powerful Chinese leader in decades.
The question, they say, is whether Li’s close relationship with Xi makes him a yes-man with little leeway to challenge the paramount leader or a trusted confidant with the ability to push back if the latter’s policies go too far.
Over a decade as general secretary of the Communist Party, Xi, who is 69, began a norm-defying third term last October by packing the seven-member Politburo Standing Committee that sits at the apex of political power in China with loyal lieutenants. Li was picked for the No. 2 role over two candidates, Hu Chunhua and Wang Yang, who had more experience but maintained a network of relationships beyond Xi’s immediate control.
Being close to Xi does not mean that an official “will bring important data to his attention or urge him to change policies to the benefit of the country,” said Victor Shih, who studies Chinese elite politics at University of California at San Diego.
But reports that Li urged a swifter end to the unpopular “zero covid” policies suggest that he may be someone with a “pretty unique willingness to nudge Xi in a certain direction,” Shih said.
Soon after being appointed as second-in-command, Li used his position to push for faster relaxation of the harsh coronavirus restrictions that had sparked nationwide protests in late November, according to a Reuters report earlier this month. By that time, China was already losing control of the virus as more transmissible variants overwhelmed mass testing and quarantines.
In late December, during a wave of critical infections and deaths that overwhelmed hospital emergency departments and crematoriums, Li chaired a meeting of the party’s top covid response team that called for an end to border restrictions, according to minutes published by Sing Tao Daily, a Hong Kong newspaper.
As head of the Chinese government, he will be implementer-in-chief for some of Xi’s main — and most difficult — policy initiatives: Campaigns to tackle inequality and bring “common prosperity” to the masses while also delivering so-called Sputnik breakthrough moments in critical technology areas like artificial intelligence, renewable energy and microchip manufacturing.
Li has wasted no time in trying to restore confidence among China’s embattled entrepreneurs. In early December, he chaired a meeting with China’s leading industry association where he promised “unswerving” efforts to create a good environment for private business.
Such promises may not soothe international corporations that are increasingly wary of investing in China after three years of sporadic lockdowns, prolonged trade and technology tensions with the United States, and after a multitude of crackdowns on Chinese entrepreneurs under Xi.
Close observers of Chinese politics question the extent to which Li will be able to temper some of Xi’s more hard-line tendencies, in part because he has always played a supporting role in the relationship. They note that this is the first time since the Mao Zedong-era that China’s second-in-command does not have an independent network, reversing an effort in recent decades to introduce a degree of power-sharing at the top of the party.
Li Qiang’s predecessor as premier, Li Keqiang, who delivered a final annual work report on Sunday, has been sidelined as Xi took direct control of areas that had previously been considered the purview of the State Council, China’s cabinet, and its premier.
Once considered a contender for the top position, the elder Li had his own power base built from rising up the ranks of the Communist Youth League. A relative economic liberalizer, he would occasionally appear to contradict messaging from Xi, including over how to balance economic growth and coronavirus control.
The career of the younger Li, however, has been intimately tied to Xi for the last two decades. In 2004, shortly after becoming the youngest ever party boss of Wenzhou, a city in Zhejiang province famous for grasping China’s export boom to become a leading global manufacturing hub for shoes, eyeglasses and electronics, he was appointed as secretary general for the provincial party committee.
That made him de facto chief of staff and he would spend hours traveling with Xi, who was in his first tenure as a provincial party boss. Li would help Xi write speeches or formulate policy initiatives for China’s future leader.
Nearly a decade later, Li would follow in his mentor’s footsteps to become governor of Zhejiang and then gradually work his way clockwise around the Yangtze River Basin to lead Jiangsu province and Shanghai as party boss.
This tour around China’s entrepreneurial heartland meant he developed close relationships with leading business figures such as Jack Ma, the founder of online retailer Alibaba.
In 2016, Li wrote in a foreword to a book by Alibaba executive Wang Jian where he said that both Wang and Ma were people he enjoyed speaking with and had made significant contributions to the development of Zhejiang.
In each location, Li made a show of supporting innovative business ventures. In Jiangsu, he sought to revive a struggling manufacturing expo dedicated to the internet of things. In Shanghai in 2019, he opened a conference on artificial intelligence where Musk and Ma debated the potential threat to humanity of a runaway machine super-intelligence.
Li has professed fascination with emerging technologies that could revolutionize the economy and society. He told state media in 2008 that he had been an early adopter of email and frequented online discussion forums regularly in the 1990s. At various points, he has publicly recommended the book “Homo Deus” where historian Yuval Noah Harari explores how technology will revolutionize the future of civilization and the 1999 film “Bicentennial Man” about a robot who wants to be human.
But nurturing cutting-edge technologies is another area where the role of the premier has been diminished. Areas of emerging technology once considered the purview of the State Council are increasingly being handed to party committees, reducing the government’s ability to make decisions independently.
The biggest unknown is that Li, unlike his predecessors when they took on the job, has never been in charge of any central-level administrations or had to coordinate between various agencies, said Yu Jie, senior research fellow on China at Chatham House, a British think tank. The role will test his capacity to be deal broker, she said.
A government restructuring plan that will be passed at this week’s legislative meeting will further extend direct party involvement in the push for “self-reliance” in critical technologies and foundational science by establishing a central commission to oversee policymaking in the field.
While at a practical level the State Council remains the main implementer of economic policies, areas like cybersecurity, energy and big data are increasingly dictated directly by the party. “The premier has fewer jurisdictions because a lot of the major policies are decided by party-leading groups and commissions, most of which are chaired by Xi Jinping,” said UC-San Diego’s Shih.