China’s Political System

Opaque and shrouded in secrecy, China’s political system and decision-making processes are mysteries to many Westerners. At one level, China is a one-party state that has been ruled by the Chinese Communist Party (CCP) since 1949. But rather than being rigidly hierarchical and authoritarian, which is often the assumption, political power in China now is diffuse, complex, and at times highly competitive. Despite its grip on power, the Party and its senior leaders (the Politburo and its Standing Committee) are not always able to dictate policy decisions as they once did. Instead, present-day China’s political process is infused with other political actors that influence and sometimes determine policy.

Three other main actors co-exist with the Party at the top of China’s political system. Chief among these is the muscular state government bureaucracy, whose structures closely parallel the Party’s throughout China, operating in a largely separate but interlocking way to implement and administer state business. Another key institution is the People’s Liberation Army, operating again largely separately and with a tenuous distinction between civilian, military, and Party leadership. Completing the top political institutions is the National People’s Congress, constitutionally the highest organ of state power but in practice the weakest of the top political institutions.

Other political actors in China include provincial and local officials; a growing body of official and quasi-official policy research groups and think tanks that feed proposals into the policy process; a collection of state sector, multinational, and even private business interests exerting pressure on policy decisions; a vigorous academic and university community; a diverse media that informs public opinion; and an increasingly vocal and better-informed citizenry that are demanding more transparency and accountability from government. New forms of communication and information availability also have pressured the PRC government to make changes in its political system, and have provided the Party with new means of maintaining political control. Chinese politics is further complicated by other factors. In the absence of a more formalized institutional infrastructure, personal affiliations can play a significant role in political decisions, adding unpredictability to an already murky process. In addition, discipline between the different levels of party and government structure can be tenuous, leading to ineffective implementation of policy and, in some cases, serious problems with corruption.

Competitive Advantage when incorporating China to your supply chain

Low Labor Wages

Direct savings due to the low base cost in China, specifically in areas such as utilities, raw materials and labor costs.

Fast Market Growth

During the last decade China’s economy has grown the fastest among all major nations giving the Chinese consumer an increase in their purchasing power.

Quality Improvements in Products

The quality of products in China is slowly reaching western standards and in some cases even surpassing them.

Policy Support for Exporting Businesses

Policy Support by the government in which they give incentives such as tax exemptions and special economic zones.