China Promotions Hint at Reforms

CHINA'S rubber-stamp legislature yesterday promoted two pragmatic officials to be vice premiers in what is widely seen as an encouraging sign for the country's besieged economic reforms. The elevation of the moderates is an attempt by Deng Xiaoping, China's senior leader and the architect of reform, to rebuff a powerful faction of doctrinaire conservatives, say Western and Asian diplomats.

The changes could help Mr. Deng revive the credo of bold innovation that inspired his reforms before his rivals reimposed strict central planning in 1988, the diplomats say.

The new vice premiers - Zou Jiahua, head of the State Planning Commission, and Zhu Rongji, mayor of Shanghai - are said to favor a renewal of market-oriented economic forces. They are likely to tilt the State Council, China's Cabinet, away from the harsher aspects of a command economy, the diplomats say.

"These changes are the most promising political sign for economic reform in more than two years," says an Asian diplomat on condition of anonymity.

The appointments are unlikely to spur immediate price decontrol, private shareholding, and other reforms that conservatives shelved. A severe deficit and worries of inflation preclude initiatives that could undercut stability, the diplomats say.

"The economy is in lousy shape and social stability is still the main concern: No one is going to go out on a limb for reform," a Western diplomat says.

Nevertheless, Mr. Zou and Mr. Zhu are likely to resist the continued dismantling of Deng's reforms and, if the economy improves, might support en- lightened changes, diplomats say.

Zhu, in particular, is said to approach economics with a pragmatic, open mind, free of orthodox Marxism. He earned the plaudits of foreign businessmen and the nickname "One-Chop Zhu" because of his efforts to cut red tape and promote foreign investment in China's largest city.

Wooing new investment

Since becoming Shanghai's mayor in 1988, Zhu has stumped successfully among leadership circles for the Pudong New Area, a large tract of run-down buildings and rice paddies in East Shanghai set aside for foreign investment.

According to a highly ambitious development scheme, Pudong would include high-technology manufacturing, a free port, and foreign bank branches. It is the pet project of some leaders who see it as the catalyst for development of the lower half of the Yangtze River Valley.

In political affairs, Zhu is admired in Shanghai for his tolerant handling of pro-democracy protests during the spring of 1989.

When disgruntled students and workers blocked city streets, Zhu defused the crisis by pledging that he would not call in the Army if the demonstrators cleared the streets. His methods contrasted markedly with the brute force used in Beijing.

Zou has qualifications of a hard-liner that belie his moderate reputation. Educated in the Soviet Union, Zou has spent much of his career managing industries tied to the military. He is the son of the late revolutionary Zou Taofen and son-in-law of Marshal Ye Jianying, an influential political figure who died in 1986.

One of the new vice premiers is expected to assume the portfolio of Yao Yilin, a vice premier who has closely followed the ultra-orthodox socialist guidance of octogenarian leader Chen Yun.

The promotions are the fruit of political spadework by Deng in Shanghai during the Chinese lunar new year period. Deng has grown concerned in recent months over the slow sabotage of his reforms, Chinese sources say.

Quotations from Deng in a commentary last month in Liberation Daily, a Shanghai newspaper, seemed to hint his anxiety and the leadership changes.

"To make revolution and to undertake economic construction, we need a group of pioneers who are daring enough in thinking, exploration, and creation," the March 2 commentary quoted Deng as saying.

Signs of party rivalry

In a sign of factional rivalry within the Communist Party, the Shanghai commentary piqued authorities in the propaganda apparatus controlled by conservative elders, Chinese sources say.

The party's propaganda department in Beijing dispatched an official to Liberation Daily who demanded to know who authorized the comparatively bold, reformist commentary. He was told that the Shanghai municipal party committee - i.e., a top leader - sanctioned the article, according to the sources.

The promotions end a freeze on leadership changes that Deng declared in 1989 after replacing Zhao Ziyang with Jiang Zemin as party general secretary. Mr. Zhao was made the scapegoat for the 1989 pro-democracy movement.