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China's richest man hopes to join the political elite

By Jaime FlorCruz and Xiaoni Chen
September 29, 2011 -- Updated 1519 GMT (2319 HKT)
 A file picture from January 29, 2009 shows Liang Wengen, of Sany Group, in Berlin as part of a group with the Chinese Premier.
A file picture from January 29, 2009 shows Liang Wengen, of Sany Group, in Berlin as part of a group with the Chinese Premier.
STORY HIGHLIGHTS
  • Liang Wengen can be a candidate for Communist Party of China's Central Committee
  • The Central Committee is an important body in China's top-down political structure
  • Previous applications from Liang, China's richest man, have been rejected

Beijing (CNN) -- Liang Wengen, China's richest man, received the green light to become a candidate for the Communist Party of China's Central Committee. If elected, Liang will be the first private entrepreneur to join the ruling party's policymaking body.

Liang, 55, is chairman and founder of Sany Group, China's largest heavy machinery company. Both Forbes and Hurun China Rich List rank him on top of their 2011 rich list, estimating his wealth at $9.3 billion and $10.7 billion, respectively.

He Zhenlin, Sany Group's vice president, confirmed with CNN that "Liang has passed qualification checks" as a candidate for a seat as alternate member of the Central Committee. Liang is "waiting for (formal) election," which will take place late next year.

The Central Committee is an important body in China's top-down political structure. Every five years, delegates to communist party congress elect over 200 full-fledged members and about 150 alternate members.

Members of the Central Committee select among themselves members of the party's political bureau, or politburo, and its standing committee comprised of nine members.

The Central Committee typically meets four times a year to discuss and approve major policies.

In between these meetings - called Plenums in communist parlance -major decisions are made by the Politburo, headed by party chief and state president Hu Jintao. Its members meet more frequently.

Liang became a communist member in 2004. Since then, he has been a delegate to the National People Congress (NPC), China highest legislative body. He was also a delegate to the last Communist Party Congress in 2007.

Liang has three times applied to become a party member but he was rejected each time. The last time he was rejected was because "the Party Constitution didn't allow recruiting private entrepreneurs who hire more than seven employees," Fu Hongze, a director at the Sany Group, told CNN.

Liang's party membership came after former Chinese president Jiang Zemin pushed through the controversial notion that private business owners may also join the Communist Party in 2001.

"Currently there are very few party members working in the private sector," notes Tang Wenfang, author of the book "Public Opinion and Political Change in China." "There is a need to correct this imbalance by recruiting non-party private entrepreneurs, as this group of people is gaining economic power. If they are not co-opted, they can potentially wield independent political influence."

Rupert Hoogewerf, who has served as chief researcher for Hurun Rich list for many years, says Liang's expected election into the Central Committee is largely symbolic. He points out that the private sector is "clearly an important player now in the economy as a whole," creating new jobs and paying substantial taxes. "It is a symbiotic relationship," he says. "They help each other out."

If Liang is elected next year, Hoogewerf adds, his new political status will be a morale boost for China's private sector and may also benefit his company, the Sany Group., which Liang founded in 1989.

It will not be the first time for Liang to work with the ruling party. He and his company have been involved in high-profile partnerships with the Chinese government.

"It wasn't a coincidence that Sany was in Chile to rescue the trapped miners last year," Hoogewerf tells CNN. "The Chinese government offered to help and Liang was the person asked to make it happen on behalf of the government. It was a big thing."

Sany provided heavy machinery during the rescue efforts.

During the devastating Sichuan earthquake in 2008, Liang donated 3 million yuan (US$ 461,000) in cash and 15 million yuan (about $ 2.3 million) worth of heavy machinery, according to state media reports. Sany's volunteer rescue team arrived in the worst hit area within two days after the earthquake hit.

"Liang's increased political capital will help push Sany's dominance to a higher level in both domestic and international market." said Wang Zhengxu at the University of Nottingham.

Wang says he will not be surprised if Liang is admitted into the Central Committee. He explains: "By co-opting private business leaders into CPC, the party hopes to renew its legitimacy as the Party that represents all the critical groups and sectors of the Chinese society."

Tang says this will be an important move for China's political reform. "In the long run, the inclusion of the private sector in the CPC is likely to diversify the party's membership," Tang says.

He explains: "Different groups of party members may form different factions and compete for power within the CPC, instead of forming strong opposition parties outside the CPC. The result is likely to be the strengthening of 'intra-party democracy' with continued CPC domination over the other independent political parties."

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