What Keeps Xi Up At Night: Beijing's Internal and External Challenges - Threats to Chinese Communist Party (CCP) Rule, Slowing Economic Growth and Technological Dependency, Financial Sector Risks

This important report compilation contains the testimony of nine renowned experts at a hearing in February 2019 about internal and external challenges to the leadership of Chinese President Xi Jinping. There is a thorough examination of the issues and problems facing the Chinese Communist Party (CCP) in its attempts to consolidate power at home and increase its influence abroad. The first panel explored the implications of President Xi and the CCP's tightening control over economic and security policy making. The second panel examined China's domestic challenges, considering China's economic weakness and financial sector risks, the risks and benefits of China's state-led economic policies, and the country's reliance on a number of key foreign technologies. The third panel assessed China's external challenges, focusing on the People's Liberation Army's shortcomings and the limits of Chinese soft, sharp, and hard power.

Panel I: The Threat from Within: "Party-ification" and Internal Threats to CCP Rule * 1. Jude Blanchette, Senior Advisor and China Practice Lead, Crumpton Group * 2. Timothy Heath, Senior International Defense Researcher, RAND Corporation * 3. Andrew Wedeman, Professor, Department of Political Science, Georgia State University * Panel II: Domestic Dilemmas: Beijing's Slowing Growth and Technological Dependency * 4. Michael Hirson, Practice Head, China and Northeast Asia, Eurasia Group * 5. Nicholas Borst, Vice President and Director of China Research, Seafarer Capital * 6. Greg Levesque, Managing Director, Pointe Bello * Panel III: Backlash from Abroad: The Limits of Beijing's Power to Shape its External Environment * 7. Lieutenant Colonel Dennis Blasko, U.S. Army (Ret.), Independent Analyst * 8. Rush Doshi, Brookings-Yale Postdoctoral Fellow * 9. Lindsey Ford, Director of Political-Security Affairs, Asia Society Policy Institute

This year marks the 40th anniversary of the establishment of U.S.-China diplomatic relations. Currently, however, the relationship is strained by strategic competition and trade tensions as China seeks to reshape the international order in ways that are often at odds with U.S. interests. While it is important to acknowledge the Chinese Communist Party's effectiveness in expanding control of social, political, and economic activity, it is also important to identify and understand the implications of the regime's vulnerabilities. According to the Party, endemic corruption is the greatest internal challenge to its legitimacy. President Xi's anticorruption campaign began six years ago, but it remains unclear whether the campaign is focused on strengthening his political power or cleaning up the Party, and whether the campaign has had any real effects on reducing corruption. These are all issues that deserve closer scrutiny. Some analysts believe President Xi's consolidation of power has created a dangerous echo chamber for decision making, which could complicate U.S.-China relations during times of heightened tensions or crisis. They also directly bear on U.S. economic interests—American businesses are threatened under economic and judicial systems that put the Party first.