(Repeats story first published on Tuesday)
By David Lague and Benjamin Kang Lim
HONG KONG, April 23 (Reuters) - In 1938, in the midst of a long campaign to bring China under Communist Party rule, revolutionary leader Mao Zedong wrote: "Whoever has an army has power."
Xi Jinping, Mao's latest successor, has taken that dictum to heart.
He has donned camouflage fatigues, installed himself as commander-in-chief and taken control of the two million-strong Chinese military, the People's Liberation Army. It is the biggest overhaul of the PLA since Mao led it to victory in the nation's civil war and founded the People's Republic in 1949.
Xi has accelerated the PLA's shift to naval power from a traditionally land-based force. He has broken up its vast, Maoist-era military bureaucracy. A new chain of command leads directly to Xi as chairman of the Central Military Commission, China's top military decision-making body. Operational leadership of naval, missile, air, ground and cyber forces has been separated from administration and training - a structure that Chinese and Western defense analysts say borrows from U.S. military organization.
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The Chinese leader isn't just revolutionizing the PLA. Xi is making a series of moves that are transforming both China and the global order. He has abandoned reform architect Deng Xiaoping's injunction that China should hide its strength and bide its time. The waiting game is over. Xi's speeches are peppered with references to his "Chinese dream," where an ancient nation recovers from the humiliation of foreign invasion and retakes its rightful place as the dominant power in Asia.
The effort includes signature shows of soft power: Xi's multibillion-dollar "Belt and Road" program to build a global trade and infrastructure network with China at its center, and his "Made in China 2025" plan to turn the country into a high-tech manufacturing giant.
But the boldest stroke is his expansion of China's hard power, through his remaking of the PLA, the world's largest fighting force. At the core of this vision of national renewal is a loyal, corruption-free military that Xi demands must be prepared to fight and win.
His push to project power abroad was accompanied by a power play at home. Xi has purged more than 100 generals accused of corruption or disloyalty, according to the official state-controlled media.
A raw demonstration of his authority came when state television broadcast a laudatory documentary series about the PLA, "Strong Military." In one scene in the 2017 series, an elderly man sits in a military court at a desk marked "defendant," looking frail in a navy-blue civilian jacket. It is Guo Boxiong, a former general and the most senior officer convicted in Xi's purge. He reads his confession to charges of bribery from a sheaf of papers gripped in both hands.
"The Central Military Commission dealt with my case completely correctly," says Guo, who had once served as vice-chairman of the body. "I must confess my guilt and take responsibility for it." Guo was sentenced to life in prison.
In a series of stories, Reuters is exploring how the rapid and disruptive advance of Chinese hard power on Xi Jinping's watch has ended the era of unquestioned U.S. supremacy in Asia. In just over two decades, China has built a force of conventional missiles that rival or outperform those in the U.S. armory. China's shipyards have spawned the world's biggest navy, which now rules the waves in East Asia. Beijing can now launch nuclear-armed missiles from an operational fleet of ballistic missile submarines, giving it a powerful second-strike capability. And the PLA is fortifying posts across vast expanses of the South China Sea, while stepping up preparations to recover Taiwan, by force if necessary.
'THE U.S. COULD LOSE'
For the first time since Portuguese traders reached the Chinese coast five centuries ago, China has the military power to dominate the seas off its coast. Conflict between China and the United States in these waters would be destructive and bloody, particularly a clash over Taiwan, according to serving and retired senior American officers. And despite decades of unrivaled power since the end of the Cold War, there would be no guarantee America would prevail.
"The U.S. could lose," said Gary Roughead, co-chair of a bipartisan review of the Trump administration's defense strategy published in November. "We really are at a significant inflection point in history."
Roughead is no armchair theorist: A retired admiral, as former Chief of Naval Operations he held the top job in the U.S. Navy until 2011. His alarm reflects a growing view across the American defense establishment. In their report, he and his colleagues issued a dire warning. The United States faces a "national security crisis," principally arising from growing Chinese and Russian military power. "U.S. military superiority is no longer assured and the implications for American interests and American security are severe," the panel concluded.
It is clear that Xi wants to bring the era of U.S. dominance in Asia to an end. "In the final analysis, it is for the people of Asia to run the affairs of Asia, solve the problems of Asia and uphold the security of Asia," he said in a 2014 speech to foreign leaders on regional security.
China's Ministry of National Defense, the U.S. Indo-Pacific Command and the Pentagon did not respond to questions for this article or detailed summaries of its findings.
This account of Xi and the PLA - which despite the "army" in its name comprises all military branches - is based on interviews with 17 current and former military officers from China, the United States, Taiwan and Australia. Many would only speak on condition of anonymity. It draws on the accounts of Chinese officials and people with ties to the senior leadership in Beijing who have known Xi Jinping and his family for decades and are familiar with his career as he rose through the party and government bureaucracy. It also relies on Chinese government publications describing Xi's political thinking, his speeches and official documentaries showcasing his leadership of the military.
In Washington, the world's pre-eminent military power is mobilizing to respond. After decades of seeking engagement in the expectation that Beijing would become a cooperative partner in world affairs, the United States is treating China as a strategic competitor bent on displacing it as Asia's dominant force.
Largely in reaction to this challenge, Washington is boosting defense spending, rebuilding its navy and urgently developing new weapons, particularly longer range conventional missiles. It is expanding military ties with other regional powers, including Japan, South Korea, Taiwan, Australia, Singapore and India. And it's conducting an international diplomatic and intelligence campaign to counter China's cyber-attacks, traditional espionage and intellectual property theft. This campaign includes efforts to contain the global reach of Chinese telecom companies Huawei and ZTE Corp.
The confrontation comes as the administration of President Donald Trump is waging a tariff war aimed at reducing China's massive trade surplus with the United States. However the trade conflict is resolved, a graver risk is the possibility that the deeper tensions could boil over into an armed clash between Beijing and Washington and its allies in the hotly contested maritime zones off the Chinese coast.
The rise of the PLA is not all Xi's doing. Long before he took power, the military had been transformed from the massive but rudimentary land force that swept Mao and his comrades, including Xi's father, to victory over the Nationalists in 1949. Decades of steep increases in defense spending paid for an arsenal of high technology weapons; millions of soldiers were demobilized. But corruption became endemic.
Xi's two predecessors, Jiang Zemin and Hu Jintao, were civilians who took office without a network of support among PLA brass. They fostered loyalty through patronage, pay rises and budget increases, according to Chinese and Taiwanese analysts and retired officers. Under the weak leadership of Hu in particular, they say, senior officers exploited their positions to siphon off money, particularly from the logistic and equipment budgets. Rank buying became rampant.
The military hierarchy Xi inherited had become a law unto itself under Hu, according to Li Nan, a scholar of the Chinese military at the National University of Singapore. "It was out of control, in a sense," said Li. "Now the power is centralized in the hands of Xi Jinping."
Xi, a so-called princeling, grew up as a member of China's Communist Party aristocracy, even though his family suffered separation and persecution in Mao's chaotic Cultural Revolution. His late father, Xi Zhongxun, was a revolutionary military leader who became a top government official in the early years of Communist rule. He was later purged in Mao's upheavals, before emerging a key leader of China's market reforms in the 1980s.
Xi's dramatic accumulation of power was unexpected. He took a low profile as he slowly worked his way up the Communist Party and state bureaucracy, according to multiple Chinese familiar with his early career.
His first job out of university in 1979 was serving in a junior post as a uniformed aide to General Geng Biao, then minister of defense. Xi's official biography records this three-year posting as "active duty." In this role, he had access to classified military documents, including files on the 1979 Chinese invasion of Vietnam, according to sources with ties to the leadership. He had to memorize hundreds of telephone numbers and was not allowed to rely on a telephone book, in case it was lost or stolen, they said.
He then began a series of provincial government and party postings. In these roles, his performance was relatively unremarkable. As governor of the southeastern Province of Fujian, for instance, he was obsessed with the bureaucratic routine of political study sessions where officials review Communist Party documents and speeches of senior leaders, according to people who knew him at the time.
And he was far from universally popular. He finished last in elections for alternate members of the party's 200-strong Central Committee during the 15th Communist Party Congress in 1997.
This nondescript record appears to have worked in his favor. During his period as China's paramount leader, President Jiang Zemin handpicked Xi for senior office because the younger man was perceived to lack ambition, according to sources with close ties to the Chinese leadership. Xi was also thought to be a pliable candidate because he lacked a power base, one source said, speaking on condition of anonymity.
But as China's top leader, he has shown a willingness to impose radical change at the top of the party, government and military.
"When I talk to my mainland friends, they all say he is a risk taker," said Andrew Yang Nien-Dzu, former defense minister of Taiwan. "You never know what his next move will be."
XI THE SOLDIER
From the beginning, Xi's corruption purge and promotion of loyal officers made it clear he had big plans for the PLA. Then, in mid-2015, he cut 300,000 mostly non-combat and administrative personnel before launching a sweeping overhaul of the military structure.
He broke up the four sprawling, Maoist-era "general departments" of the PLA that had become powerful, highly autonomous and deeply corrupt, said Li from the National University of Singapore. Xi replaced them with 15 new agencies that report directly to the Central Military Commission he chairs.
He also scrapped the seven geographically based military regions and replaced them with five joint-service theater commands. These new regional commands, comparable to those that govern the U.S. armed forces, are responsible for military operations and have a strong focus on combining air, land, naval and other capabilities of the Chinese armed forces to suit modern warfare.
Xi also promoted favored commanders, many of them officers he knew in Fujian and Zhejiang provinces, where he served the bulk of his early career as an official, according to Chinese and Western observers of the PLA. Others hail from his home province of Shaanxi or are fellow princelings.
At the 19th Party Congress in October 2017, Xi further tightened his grip over the top military leadership, paring the Central Military Commission from 11 members to seven and stacking it with loyalists. Xi knew most of them from Shaanxi and Fujian.
As he burnishes his military credentials, Xi draws on his early service in uniform. In speeches to military audiences, he describes himself as a soldier-turned-official, according to reports in the state-controlled media. In distinctive PLA camouflage fatigues, cap and combat boots, he has overseen some of the biggest military parades since the 1949 Communist victory. In the most recent of these displays, Xi has taken the salute from the troops without sharing the podium with the usual line-up of fellow party leaders and elders.
In a massive naval exercise in April last year, Xi boarded the guided-missile destroyer Changsha to review the Chinese fleet of 48 warships in the South China Sea. State-run television showed the navy commander, Vice Admiral Shen Jinlong, and navy political commissar, Vice Admiral Qin Shengxiang, standing to attention as they reported to Xi and saluted. Xi then gave the order for the exercise to proceed.
Both navy chiefs are Xi protégés. Shen has been rapidly promoted under Xi, leapfrogging other, more senior officers, according to Chinese and Western analysts. Qin had worked closely with the Chinese leader in a top post in the Central Military Commission before his promotion in 2017 to his navy role, China's official military media reported.
Xi was also in fatigues again in July 2017 at a massive military parade to mark the 90th anniversary of the PLA at the Zhurihe training ground in Inner Mongolia. He took the salute from the parade commander, General Han Weiguo, an officer who served in Fujian while Xi was a party and government official in the province. Han has enjoyed a meteoric rise under Xi, being promoted to command China's ground forces shortly after this parade.
"Xi Jinping is obsessed with military parades," said Willy Lam Wo-lap, a veteran observer of personnel movements in China's military and political elites and a professor at the Chinese University of Hong Kong. "He loves these demonstrations of raw power."
As part of Xi's martial image-building, the party's propaganda machine portrays him as the leader responsible for a decisive pivot in China's recovery from foreign conquest and colonial domination that began with the First Opium War in the mid-19th Century.
In the opening scenes of the "Strong Military" documentary, Xi is shown boarding the guided missile destroyer Haikou at Shekou port on December 8, 2012, and sailing into the South China Sea for the first time since becoming party and military chief that year. As Xi looks to the horizon through binoculars, the narrator says: "As the warship pierces the waves, Xi Jinping peers toward a vision obscured in the mist of history when, 170 years ago, Western powers came from the sea to open the door to China, beginning a bitter nightmare for ancient China."
The nightmare ends, according to the documentary, with the Communist victory under Mao and the periods of growing economic and military power under former leaders Deng, Jiang and Hu. With Xi in charge, the series shows, a heavily armed China is poised to recover its former glory.
PRESSURE ON TAIWAN
Propaganda aside, Xi is proving far more assertive than his most recent predecessors in employing China's new military power. In 2013, China began dredging and island-building in the disputed Spratly Islands in the South China Sea, an area in which Beijing has competing territorial claims with the Philippines, Malaysia, Taiwan, Vietnam and Brunei.
Xi personally directed these moves, according to a July 2017 commentary in Study Times, the official mouthpiece of the Communist Party's Central Party School. "It is the equivalent of building a Great Wall at sea," the commentary said.
Extensive fortification of these outposts, including missile batteries, means that China has virtually annexed a vast swathe of this ocean. Ahead of his May 30 appointment to head the U.S. Indo-Pacific Command, Admiral Philip Davidson told a Congressional committee that China was now capable of controlling the South China Sea in all scenarios "short of war."
Xi is also stepping up military pressure on Taiwan, Japan and India. Alongside a massive arsenal of missiles capable of striking Taiwan, Chinese naval and air forces conduct increasingly complex exercises that regularly encircle the self-governing island.
These exercises are designed to intimidate Taiwan and wear down its forces which must respond to these drills, according to some Taiwanese defense analysts. "They are obviously applying a lot of coercive power over Taiwan," said Yang, the former Taiwan defense minister. Beijing regards Taiwan as a renegade province and is determined to bring it under mainland control.
In response to questions from Reuters, Taiwan's Defense Ministry said it would continue to maintain surveillance and deploy aircraft and warships to "ensure the safety of our nation's air and sea territory."
Chinese naval and air forces are also increasing the tempo of deployments, exercises and patrols through the Japanese island chain. Japan's annual military White Paper last year said China's "unilateral escalation" of activities around Japan was arousing strong security concerns. Japanese interceptors scrambled 638 times in the past year against Chinese aircraft, the government reported this month, up almost 30 percent from the year before.
"China has expanded and intensified military activities not only in the East China Sea, but also in the Pacific Ocean and the seas around Japan," the Japanese Defense Ministry said in response to questions from Reuters. "These activities appear aimed at improving operational capability and bolstering China's presence."
Despite these assertive moves, there are still questions from inside the PLA about the capacity of Chinese forces to compete with the United States and other advanced military powers. In numerous published commentaries, Chinese officers and strategists point to the PLA's lack of experience in conflict, technological shortcomings and failure to introduce effective command and control.
Xi's power grab and bold agenda also carry great risk for him personally, the party and China. There has been widespread speculation in China that the corruption crackdown in the military and a parallel purge of party and government officials is at least in part Xi's response to a vicious, behind-the-scenes power struggle.
Rare evidence of this surfaced at a key gathering of top officials. On the sidelines of the 19th Party Congress in October 2017, Liu Shiyu, then China's chief stock market regulator, accused a group of senior officials deposed in the purge of plotting a coup, including the disgraced former military chief Guo Boxiong. Earlier, the official military newspaper hinted at similar accusations, without citing evidence. Guo, who was imprisoned on corruption charges, could not be reached for comment. The Chinese government has not commented further on this allegation.
In bringing down so many powerful military and party leaders and their factions, Xi has made many dangerous enemies, say people with ties to the leadership. And steep increases in military spending will become more difficult to sustain if the growth of the debt-burdened Chinese economy continues to slow.
Still, Xi shows no sign of toning down his drive to galvanize the Chinese military. On October 25, he toured the Southern Theater Command in the city of Guangzhou, the headquarters responsible for the contested South China Sea. State television showed Xi in fatigues and combat boots, striding through the command post with senior brass. Xi, state media reported, told officers to concentrate on "preparing for war and combat."
(Reporting by David Lague in Hong Kong and Benjamin Kang Lim. Edited by Peter Hirschberg.)
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