Zhu Rongji, China's premier from 1998 to 2003, who, along with Jiang Zemin, successfully steered the country to a market economy and engineered its accession to the World Trade Organisation (WTO) in 2001, died on 12 August aged 97.
Both actions, through bold and steely but necessary reforms, often faced fierce resistance from fellow Chinese Communist Party (CCP) leaders.
Dubbed the “economic czar”, Zhu held the reins of economic policy for more than a decade, initially as the governor of the Chinese central bank and vice-premier in the early 1990s under Chinese president Jiang Zemin, who died in 2022.
Zhu’s painful economic reforms dragged China into creating a market economy and integrated the country into global markets at a time when many CCP leaders wanted to remain on the old, but failed, centrally planned, communist path. His reforms steered China from being a peripheral developing country to becoming the current global economic giant that has the world’s second-largest economy.
In the early 1990s, China’s economy overheated, with the demand for goods and services vastly exceeding the capacity of the economy to supply. This led to high inflation, over-lending by state banks, real estate speculation and wild stock market volatility.
In 1992, Chinese leader Deng Xiaoping embarked on his 1992 Southern Tour. He pushed for a ramping up of market liberalisation, infrastructure development and industrial expansions. On Deng’s signal, state banks went on a lending spree to local governments to fund superfluous industrial development projects. Corruption exploded.
Zhu’s stint in charge of economic reforms started when he was appointed as governor of the Chinese central bank, the People’s Bank of China, in 1993 and as vice-premier of China.
The year marked a radical shift for Chinese economic policy as the government adopted its new goal to achieve a “socialist market economy”, replacing its central command plan with macro-economic regulation and making annual GDP growth goals a part of its economic strategy. The new “socialist market economy” framework was adopted at the March 2023 National People’s Congress of the CCP.
Zhu’s reforms included closing many bloated state-owned companies, privatising others and modernising the country’s fiscal and taxation regimes. He removed the power to tax from local governments and handed it to the central government.
He brought high inflation to heal. He stabilised the Chinese currency. In 1998, he reformed property ownership, cancelled the state housing system whereby state entities allocated housing to their employees, allowing state companies to sell housing to families. Citizens were able to buy housing at subsidised prices. This created a private property market which unleashed a real-estate boom that helped fuel China’s high economic growth rates. Within 10 years most of the housing in the country’s urban areas were privately owned.
Zhu calmly steered the economy through the devastating 1997 Asian financial crisis.
China’s economic growth rates were more than 8% annually from 2000 to 2010. In 2007, it was at a head-spinning 14.2%.
Zhu’s radical structural financial reforms and tightening the macro-economic environment to tackle the overheated economy was done through what would be called a “soft landing” for the economy. He changed the focus of the central bank to macro-economic regulation, reducing unauthorised credit loans and curbed real estate speculation.
He also fought financial corruption. In 1994, he introduced fiscal and tax reforms, including centralising state revenue collection and taxing powers, thereby reducing the powers of local governments to provide uncontrolled credit.
To get the economic reforms through against fierce resistance by traditional Chinese communists, he had to be uncompromising, tough and clear but also pragmatic and resourceful.
He was also known as the “iron-fisted premier”. His public fight against corruption, with low levels of corruption critical to economic growth, development and stability for any country — something most African governments, since Liberia became the first African country to become independent in 1847, has refused to accept — won Zhu many admirers in the country.
“No matter whether there is a minefield or an abyss ahead of me, I will move forward without hesitation and I will do my best until I die,” he told a press conference in 1998 soon after being appointed premier. A premier is the second-most powerful leader in China after the president.
Zhu also regularly warned Chinese leaders against the development of an arrogant, self-satisfied and greedy CCP-connected elite enriched by the trappings of power and who take citizens’ support for granted.
In 1998, Zhu cautioned: "Our country faces many potential crises that could erupt at any time. Ordinary people are discontent about us in many ways. Especially, there is corruption among officials, the gulf between rich and poor and the way some local officials act like tyrants."
His reforms helped create the Chinese economic miracle, which has lifted millions out of poverty, enlarged the country’s middle class and turned the country into the factory of the world, with China overtaking Japan to become the second-largest economy behind the United States in 2010.
Zhu’s reforms continued and expanded on Deng's 1979 groundbreaking economic reforms. In December 1978, the Chinese government had adopted its groundbreaking new economic reform plan to open its economy to foreign capital, technology and management techniques.
In July 1979, the Chinese government adopted the Law on Joint Ventures Using Chinese and Foreign Investment to normalise foreign investments by providing flexible market regulations and tax incentives. The government established the first Special Economic Zones in Shenzhen, Zhuhai and Shantu.
Former US secretary of state Henry Kissinger, in his foreword to an anthology of Zhu’s writings and speeches, praised Zhu as “a penetrating mind” who “grappled with one of the most significant reform programmes in modern history”.
In the statement announcing his death, the CCP praised Zhu’s steering of, what was then seen as frightening, unprecedented and unchartered economic reforms, during a “crucial stage” when China was “transitioning from a planned economy to a socialist market economy”.
“He emphasised that government officials must always bear in mind that they are public servants; they should have the courage to speak the truth without fear of offending others (and) eschew special privileges … while making every effort to deliver tangible results for the people,” the CCP statement read.
As premier, Zhu, who exuded personal charisma, had the gift of the gab but was also short-tempered, had overall responsibility for China's economy, served as a member of the politburo standing committee and was in the top leadership of the CPP from 1992 to 2002.
He was a fierce corruption buster and would regularly vent against corrupt Chinese government officials:
"Yes, I bang tables and glare at people. If I can't glare, I might as well be a vegetable", he told a press conference. "I want to intimidate corrupt officials".
His market liberalisation reforms, which went against communist ideology, his relentless campaigns against government and CCP corruption and his witty responses to critics made him fierce enemies in the CPP but they also made him popular among citizens.
The political culture among China’s leaders was to have carefully scripted, boring, ideologically-laden speeches. Zhu’s easy-going, off-the-cuff, non-ideologically speeches were refreshing for citizens.
China's entry into the WTO in 2001 unleashed the country's global trade expansion. In 2001, China's total trade was $510bn. In 2025, it was $6.5 trillion.
China's accession into the WTO required brutal structural reforms. Zhu forced many ineffective state-owned companies to close or privatise, in a policy known as "grasp the large, release the small". His reforms to improve the performance of inefficient SOEs, close entities too toxic and unprofitable to be reformed and his uncompromising fight against corruption led to the retrenchment of an estimated 40 million state employees. The fast-paced and dramatic nature of his economic reforms were opposed by many CCP hardliners and SOEs bosses.
Chinese party critics slammed Zhu for making too many compromises during the negotiations to allow China entry into the WTO. He was regularly accused of selling out China for opening the country’s market to foreign investment, technology and skills. On one occasion he was forced to perform "self-criticism", a ritual introduced by China’s former leader Mao Zedong for leaders to recant straying off the communist path.
Zhu was born in the southern province of Hunan.
He graduated from China’s prestigious Tsinghua University as an electrical engineer. Unlike African liberation and independence movement governments leaders, who either have not studied, studied social sciences or were in the military, China’s top leaders have mostly been engineers or economists and, therefore, had the technical know-how to manage complex governments, state-entities and economic policy. His first employment after university was at the Chinese State Planning Agency.
He joined the Communist Party in 1949, the year Mao Zedong proclaimed the People's Republic of China.
His career almost collapsed during Mao Zedong's rule, when he was under suspicion for being critical of the party direction — praising reforms in Eastern European communist countries that were different to that of reforms in China. He was exiled to rural areas to do manual labour in two separate “re-education” terms during the Cultural Revolution of 1966-1976.
He rallied back and returned to mainstay politics, becoming mayor of Shanghai in 1987 and laying the groundwork for the city to become a global financial hub.
During pro-democracy protests in 1989, Zhu called for tolerance, in contrast to the official iron-fisted treatment of the pro-democracy activists.
As the Soviet Union collapsed and with it, Soviet-style communism, China was floundering, its economy teetering. Chinese leaders were desperately trying to prevent a collapse of the Chinese communist political system and the economy.
Zhu was deployed to Beijing in 1991 to help work on reforms to modernise the Chinese economy to prevent it from going down.
He died of illness in Beijing and is survived by his wife and their two children, according to China state news agency Xinhua.
One of his obituaries concluded: “Ultimately Zhu proved his critics wrong. Joining the WTO was a watershed moment in China’s integration into the world economy, analysts say, opening the country up to more global trade and investment that spurred unprecedented growth in years to come.”
William Gumede is associate professor, School of Governance, University of the Witwatersrand and author of South Africa in BRICS (Tafelberg).