Asian markets were strong in October, and the Carnegie Asia fund rose 6.6 percent. The Chinese Communist Party held its nineteenth Congress, a meeting called every five years to appoint the leadership of the party and the country.
Xi Jinping, the President of China, took office in 2013 as Secretary General of the Party, and is also the commander in chief of the military. He launched a powerful anti-corruption campaign during his first term of office, partly in order to curb the widespread corruption among China’s rulers, but also to eliminate political enemies and consolidate his personal power.
Xi Jinping intends to become as powerful as Mao Zedong, the founder of the Communist Party, and Deng Xiaoping, who opened China’s economy to the outside world during the 1980s. Of the seven members of the standing committee of the politburo, five passed the age threshold. The new leadership comprises Xi Jinping and Premier Li Keqiang, plus five newly appointed loyal members.
Xi Jinping’s vision for the future of China has now been enshrined into the constitution, which consolidates his position. The speculation is that he will be appointed chairman of the party, which may mean he could continue to govern the country even after 2022. The last leader with that title was Mao Zedong.
The economic objectives are unchanged, and China intends to double its GDP from 2010 to 2020. This means that growth in the next few years will increase by 6.3 percent per year. Major efforts are being made to improve the country’s environment, aimed at improving quality of life for the population through cleaner air and water, social infrastructure and better housing. China is also increasing its influence through major investments in neighbouring countries.
Carnegie Asia invested in Hota Industrial, which manufactures vehicle components. Investments in China were increased by taking in three new companies:
- China Medical Systems
- Brilliance China Auto
- Anta Sport Products
The holdings in Indian Yes Bank and Bajaj Finance were divested during the month.