Xi’s Defiant End to 2018 Signals More U.S.-China Tension Ahead


Anyone betting that Chinese President Xi Jinping would back down quickly in a trade war with Donald Trump better think again.

Xi told a Beijing crowd including some of China’s most influential political, military and business figures on Tuesday that the country’s growing wealth and power had validated the Communist Party’s — and thus his own — leadership. “No one is in the position to dictate to the Chinese people what should and should not be done,” Xi said.

Xi’s speech — an 80-minute recitation of party achievements — outlined no new economic policies that might assuage investor concerns about market access or the slowing economy. Instead, he reaffirmed China’s pursuit of “indigenous innovation” in “core technologies.”

The event was intended to mark the 40th anniversary of Deng Xiaoping’s “Reform and Opening Up,” a campaign that unleashed an industrial boom that helped China outlast the Soviet Union and become the world’s second-largest economy. But coming at the end of Xi’s most tumultuous year since taking power in 2012, it also served to assert his own rule at home and push back against critics abroad, such as the U.S. president.

Over the past 12 months, Xi pushed through a repeal of Deng-era term limits — the sole legal check on his tenure — only to find himself locked in an unprecedented trade war with Trump. He decided to play down plans to dominate high-tech industries and revise his signature Belt and Road trade-and-infrastructure initiative amid whispers about whether Xi had prematurely abandoned Deng’s advice for China to hide its strength and bide its time.

“2018 has been a very difficult year for Xi Jinping,” said Trey McArver, co-founder of Beijing-based research firm Trivium China. “The question going forward is how the system responds to all these troubles bubbling up. Will the system adjust? Or will these problems open up cracks in the system and undermine Xi’s authority and his grand project?”

Rather than retreat, Xi vowed to press on. He offered long passages about the party’s supremacy and the need to promote Marxist ideology.