Zhu Rongji is a Chinese politician who served as Mayor and Party chief in Shanghai between 1987 and 1991, before serving as Vice-Premier and then the fifth Premier of the People's Republic of China from March 1998 to March 2003.
Background
Zhu Rongji was born on October 23, 1928 Changsha, China, to a family of intellectuals and wealthy landowners. According to family tradition, his family was descended from Zhu Yuanzhang, the first emperor of the Ming dynasty. His father died when he was born, and his mother died when he was nine. Zhu was subsequently raised by his uncle, Zhu Xuefang, who continued to support Zhu's education.
Education
Zhu was educated locally, and after graduation from high school he attended the prestigious Tsinghua University in Beijing. While attending Tsinghua he became a student leader and took part in activities that were organized by the Communist Party. He graduated with a degree in electrical engineering and joined the Communist Party of China in 1949, the same year that the Communists captured Beijing, ended the Chinese Civil War, and declared the beginning of the People's Republic of China. In 1951 he became the chairman of the Tsinghua Student Union.
Career
Restored to a position in the national economic planning bureaucracy, he was again purged during the Cultural Revolution. Later Zhu’s technical competence led to his return to various important positions in managing enterprises and academic insti- tutes before being tapped for a series of governmental positions during the early years of economic reform. In 1987, he was appointed mayor of Shanghai, where he served until 1991. In Shanghai he played an important role in the promotion of the special economic zone in Pudong. In 1991, he moved to Beijing for a series of increasingly responsible posts in the government and later in the Standing Committee of the Politburo. Perhaps Zhu’s most important roles during this time were as vice premier and as governor of the central bank. In 1998, Zhu was elevated to the premiership where he served until 2003.
Between 1993 and his retirement from public life in 2003, Zhu was probably the most important person in managing China’s economic reform. He moved this process in important new directions, primarily through policies designed to restructure China’s economy toward a greater role for markets, increased opening, and the creation of a more competitive Chinese business system. Partly this involved eliminating the dual- track system of market prices and state-established prices for many goods. Equally important was redesigning the fiscal system for the central government and developing structures and policies designed to establish macroeconomic stability. New taxes were imposed equally on all firms, state-owned and private. The playing field was leveled further by a restructuring of the banking system, which established hard budget targets for state banks and reduced access to funding by state-owned enterprises. The state sector began to decline in absolute terms, as a result both of the privatization of many of these enterprises and from exposure to greater foreign competition.
These factors led to a dramatic decline in the number of workers employed in state-owned enterprises, perhaps by 30–40 million between 1994–2004. However, the fact that economic growth remained at near double-digit levels meant that many, if by no means all, of these workers were able to shift to private sector jobs. Along with the establishment of a Chinese stock market composed primarily of these newly private firms, incentives to operate more efficiently were expanded dramatically. One of the most important consequences of this set of reforms was the significant decline in inflation rates. However, at the time of publication the banking system remains mired in bad debts and too many state-owned enterprises continue to exist and lose money and distort the allocation of resources in the economy.
Achievements
Politics
Zhu joined the Chinese Communist Party at a propitious moment, October 1949.
Perhaps Zhu’s greatest achievement as premier was China’s accession to the World Trade Organization in 2001. Zhu was instrumental in these long and difficult negotiations, especially those with the United States. He received considerable criticism for concessions made to the USA to obtain its vote to enter the WTO. Nonetheless, WTO accession was essential to defining much of the economic reform under Zhu and has led to much greater economic opening to the world. China has become the most important destination for foreign direct investment, and efficient Chinese firms have emerged as players in global markets. This has resulted from the dramatic reductions in tariffs and greater opportunities for foreign firms in China. The WTO agreements have resulted in considerable growth of foreign operations in China in the services, finance, and trade sectors.
One of the main consequences of Zhu’s reforms has been that many groups in China now experience very different levels of gains from economic growth. Other, more negative externalities of rapid growth also became evident. As a consequence, during his last years as premier, Zhu focused more attention on the problems of income inequality, especially rural poverty, corruption, environmental degradation, and local government failures and the unrest this foments. At the end of his time, Zhu’s record of significant reform and rapid growth was marred by important questions about the sustainability of the system.
Personality
Zhu Rongji has been recognized as a good public speaker and was notable during his career for his proficient command of English. He often made public speeches without the aid of a script, and when he did so his speeches were said to be entertaining and dramatic.
He enjoys literature, and has reportedly spent much of his retirement reading books he had no time to read while in office. He plays the erhu, an instrument similar to a two-stringed violin. He enjoys Peking Opera, and once appeared on stage as an actor in a performance.
Connections
His wife, Lao An, once served as the vice-chairman on the board of directors of China International Engineering and Consulting. She and Zhu attended two schools together, first at the Hunan First Provincial Middle School, then at Qinghua University. They have two children, a son and a daughter. Their son, Zhu Yunlai, was born in 1957. He was once the president and chief executive officer of one of China's most successful investment banks, China International Capital Corp. Their daughter, Zhu Yanlai, was born in 1956. She is currently the assistant chief executive for the Bank of China (Hong Kong), and holds a seat in the National Committee of the Chinese People's Political Consultative Conference.