Private sector attendance at China’s Communist party congress has fallen by almost 50 per cent since Xi Jinping assumed power, reflecting what analysts said was the waning status of tycoons.
The party has pledged to crack down on “disorderly expansion of capital” in an effort to reduce wealth inequality and ensure “common prosperity”.
“It is clear that Xi saw the political access that entrepreneurs had in previous years as a potential threat to the Communist party,” said Neil Thomas at Eurasia Group, a consultancy.
China’s private sector is the country’s largest employer and driver of economic growth but, according to party records reviewed by the Financial Times, only 18 of the 2,296 delegates at the 20th party congress hold executive positions at private groups.
That compares with 34 executives at the congress in 2012, when Xi took charge, and 27 at the most recent congress in 2017.
The dwindling participation under Xi contrasts with a 10 per cent increase in the reported number of party committees — to 1.6mn — at private sector companies over his first decade in power. Many of the committees, formed by employees who are party members, have been more active in corporate decision-making over recent years.
Jiang Zemin, former president and party general secretary, first invited entrepreneurs into the party in 2002. Delegates to subsequent party congresses, which are convened every five years to appoint a new leadership, included people such as Wang Jianlin, founder of the Wanda Group and once China’s richest man.
By contrast, most of the 27 executives who attended the last party congress in 2017 ran small or medium-sized enterprises. That same year, only one delegate, Zhou Haijiang of Hongdou Group, ranked among China’s 500 richest people, compared with six such delegates in 2012.
“I couldn’t find a familiar name on [this year’s] delegate list,” said an executive at a private business association, whose members include companies founded by leading entrepreneurs.
“Our best CEOs are absent from a conference that will shape their future,” added the executive, who asked not to be identified because of the sensitivity of the subject.
At this week’s congress, at which Xi is expected to be appointed to a third term as paramount leader and military commander-in-chief, just three executives from China’s top 500 private sector groups by revenue are attending as delegates.
Only one executive from the country’s once flourishing internet sector, which is dominated by private sector groups, is at the congress — the board secretary of Three Squirrels, an online snack store. Industry leaders such as Tencent and JD.com are not represented despite employing tens of thousands of party members.
Private sector executives say they still covet access to the congress. They want to curry favour with the party as they attempt to navigate the unprecedented regulatory overhauls of technology, property and other industry sectors launched last year.
But they recognise that sending a delegate to the party congress is increasingly unlikely in Xi’s China. “This is something money can’t buy,” said an executive at a Beijing-based internet company.
In September, a representative of the party’s powerful personnel department told the official Xinhua News Agency that party loyalty was paramount for potential delegates. The organization department, which selects congress delegates, listed six criteria for people hoping to attend, with adherence to Xi’s ideological teachings at the top. Strong work performance was ranked sixth.
“Politically unqualified candidates will have no chance to attend the congress,” the department said.
One of this year’s delegates is Cao Shiru, who runs a supermarket chain in the south-western city of Chengdu. Her business, Red Flag, reported declining profits in 2020 and 2021 and has had little success in expanding to other cities as planned.
A Chengdu-based entrepreneur, who was close to Cao, said she was vocal about her family’s ties to the party and would proudly talk about “her son’s previous job at the ministry of state security”.
She also made it clear her business would be supportive of the government whenever needed, he added.
The Chengdu entrepreneur, however, is sceptical about the value of representation at the party congress: “Party congress attendance won’t make your store more attractive. Only lower prices will.”