China’s Li Shangfu became the nation’s shortest-serving defense minister ever, ending months of speculation over his status, as President Xi Jinping rolls on with high-profile purges that worry investors.
The nation’s top legislative body removed the US-sanctioned general from his role without explanation, state media reported Tuesday. Li had been in the post just seven months.
He was also stripped of his state councillor title and membership of the government’s highest national defense body. No replacement for his role was announced.
Xi has now abruptly removed two newly appointed ministers since embarking on his precedent-defying third term in office last year. In July, Xi stunned the world by removing his handpicked foreign minister from that position without explanation. On Tuesday, Qin Gang was also ousted from his remaining title of state councillor, which entitled him to a seat on the nation’s cabinet.
“Stripping Li and Qin of their state titles all but confirms they are being investigated for corruption or other violations of party discipline,” said Neil Thomas, a fellow for Chinese politics at the Asia Society Policy Institute’s Center for China Analysis.
While there is no suggestion that Xi — China’s most powerful leader since Mao Zedong — is facing any threat to his authority, the abrupt personnel moves have tainted his government’s image of stability. That turmoil comes as the world’s second-largest economy tries to woo investors to combat a grinding post-pandemic slowdown.
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Li’s removal could allow for high-level military talks with the US to resume after a suspension of more than a year. China has refused US overtures for Li to speak with American military leaders because of sanctions imposed on him during the Trump administration.
China’s defense minister usually opens the Beijing Xiangshan Forum. The nation’s answer to Singapore’s Shangri-la Dialogue will be held from Oct 29-31, potentially providing clues as to who will replace Li.
Reuters has reported that General Liu Zhenli is the top contender to replace Li, citing people it didn’t identify, adding that the change could come before the forum. Liu is chief of the Joint Staff Department, effectively making him the counterpart of General Charles Q. Brown Jr., the chairman of the Joint Chiefs of Staff.
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Graft Probe
Li, whose role made him the Chinese military’s top diplomat, last appeared in public on Aug 29, when he delivered a speech at a forum in Beijing. He was under investigation over procurement of military equipment, Reuters reported earlier.
In July, the Chinese military announced a corruption probe into the hardware procurement department Li once led for roughly the time frame of his stewardship. That investigation coincided with Xi’s decision over the summer to remove two generals leading the secretive rocket force, which manages the country’s nuclear arsenal, without explanation.
Li, 65, lacks a personal history with Xi but as an aerospace engineer he was part of the so-called Cosmos Club that the Chinese leader elevated in an attempt to catch the US in technological prowess.
The son of a veteran Red Army soldier, Li became a member of the Central Military Commission at the Communist Party’s congress in October. He was the first soldier to join the top military body from the army’s Strategic Support Force, the branch created in 2015 to focus on space and electronic warfare in Xi’s push to modernize the military.
Li’s climb to the senior defense post appeared to signal Beijing’s growing emphasis on aerospace technology. After graduating from the National University of Defense Technology, Li held posts at the Xichang Satellite Launch Center, where he oversaw China’s first lunar probe. As director of the center, Li presided over the launch of China’s first anti-satellite missile.
Lan Fo'an named finance minister
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Separately, Lan Fo’an has been named finance minister to replace Liu Kun, giving him responsibility for implementing a plan to diffuse local government debt risks.
Lan’s appointment was reported by state broadcaster CCTV on Tuesday. The move was widely expected after China last month named Lan as the Communist Party chief of the finance ministry.
The appointment comes at a crucial time for China’s fiscal system. China’s government finances have become more reliant on borrowing over the past decade due to massive tax cuts and a weakening property market. At the same time, Beijing is under pressure to increase spending on social welfare to meet the needs of an ageing population and more sophisticated economy.
As finance minister, Lan will likely play a role in helping decide whether China should increase the official deficit, which is usually set at 3% of gross domestic product in most years, and the annual quota given to local governments to issue bonds for investment projects. The finance ministry has generally taken a conservative stance on government borrowing.
The post of finance minister is less powerful in China than in other major economies. Lan is not a member of the Politburo, a group of the Communist Party’s top 24 officials.
Lan, 61, is a native of the wealthy province of Guangdong in China’s south bordering Hong Kong. He spent most of his career in the Chinese province as a government official, eventually appointed vice-governor in 2016.
He started his career as a clerk at the finance ministry from 1985 to 1988, and went on to serve as Party chief of the Guangdong provincial audit office before serving in other provincial posts.
China’s President Xi Jinping has close family associations with Guangdong, his father having served as the top official there in the 1970s. Liu, the outgoing finance minister, also spent most of his government career in Guangdong.
From March 2017 to April 2021, Lan served as a member of the top group of Communist officials overseeing the southern island province of Hainan, which has been used as a testbed for reforms to tax and housing policies. He also headed the party’s anti-graft body in the province.
He was made governor of the northwestern province of Shanxi in 2021. There he oversaw the province’s difficult transition away from reliance on coal-production into new sectors like renewable energy and data storage.
