The Influence of Maoist Ideology on China’s Economic Control under President Xi Jinping


China’s economic landscape under President Xi Jinping has raised concerns among Western investors, as the ruling Communist Party extends its control over companies and enforces crackdowns on domestic tech giants. To understand these developments, it is necessary to delve into the Maoist roots embedded within Chinese institutions and the political economy, according to Chris Marquis, an author and professor of Chinese management at the University of Cambridge.

The depth of control exerted by the Chinese Communist Party (CCP) is often underestimated in the West. The party’s influence extends above the government, the economy, and even the military. Marquis suggests that Mao Zedong’s ideology, campaigns, and institutions continue to exert a profound influence on the thinking of entrepreneurs, listed companies, as well as provincial and city officials in China.

The Western world had long held the hope that China’s embrace of open markets and private enterprise, following Deng Xiaoping’s “reform and opening” policies in the late 1970s, would lead to the demise of the state-controlled economy. However, it was often overlooked that Deng’s reforms were built upon Mao’s ideological foundations, such as Mao Zedong Thought, Marxism-Leninism, “people’s democratic dictatorship,” and Communist party leadership.

Marquis explains that Mao’s ideology and the dictatorship of the proletariat take precedence over reform and opening. This implies that “reforming and opening” serves as a means to an end rather than a fundamental shift in China’s economic system. The influence of Mao’s ideology is apparent in Xi Jinping’s governance, characterized by campaign-style leadership, the central role of the Communist Party, and a strong sense of nationalism.

The heightened concern about national security has resulted in a tightening leash on the tech sector, with several industry leaders stepping down or facing scrutiny. For example, Jack Ma, the co-founder of Alibaba, disappeared from public view for over a year after criticizing government regulators. Other prominent figures in the tech sector, such as the founders of ByteDance and Pinduoduo, have also stepped down under mysterious circumstances. These actions reflect the CCP’s growing control and supervision over key industries.

To further consolidate its influence, the party has taken “golden shares” in influential tech firms, granting special rights over business decisions. Companies like Alibaba and Tencent have pledged substantial sums to support Xi Jinping’s goal of achieving “common prosperity” in the nation. Marquis predicts that the party’s control over the tech sector will intensify in the coming years, citing the formal recognition of data as a “factor of production” within the CCP’s neo-Marxist governance theory.

While Chinese leaders may publicly proclaim openness to foreign investment, their actions demonstrate a contrary belief. The trend toward stronger control over the economy hampers innovation and drives entrepreneurs to leave China. This culture of fear stifles creativity and experimentation, jeopardizing China’s ambition to achieve self-reliance and overcome dependency on foreign supply for critical sectors like semiconductors.

China’s assertive foreign policy has further complicated matters, as it has generated fear and apprehension around the world. However, in the realm of new technology, China is yet to establish a strong position. The country is likely to face numerous challenges ahead as it grapples with the consequences of abandoning Deng Xiaoping’s cautious approach in favor of a more assertive stance.

In conclusion, the influence of Maoist ideology on China’s institutions and political economy under President Xi Jinping is significant. Understanding the depth of control exerted by the CCP provides insight into the puzzling developments observed in China’s economic landscape. As China continues to tighten its grip on key industries