China's outgoing leader sees unprecedented opportunity, unknown risks

A paramilitary police officer stands in front of the Great Hall of the People at Beijing's Tiananmen Square, November 7, 2012.

BEIJING (Reuters) - China's outgoing President Hu Jintao said the nation faced risk and opportunity in equal measure as he formally opened a congress of the ruling Communist Party that will usher in a once-in-a-decade leadership change.

More than 2,000 hand-picked delegates gathered at Beijing's cavernous Great Hall of the People for the start of the week-long session, being held against a backdrop of growing social unrest, public anger at corruption and a yawning gap between rich and poor.

"At present, as the global, national and our party's conditions continue to undergo profound changes, we are faced with unprecedented opportunities for development as well as risks and challenges unknown before," Hu said in the customary speech signalling the start of the meeting.

During the congress, Hu will give up his role as party chief to anointed successor Vice President Xi Jinping. Xi then takes over state duties at the annual meeting of parliament in March.

The government has tightened security in the run-up to the congress, even banning the flying of pigeons in the capital, and has either locked up or expelled dozens of dissidents it fears could spoil the party.

Security was especially tight on Thursday around the Great Hall and Tiananmen Square next door, the scene of pro-democracy protests in 1989 that were crushed by the military.

Police dragged away a screaming protester as the Chinese national flag was raised at dawn.

The party, which came to power in 1949 after a long and bloody civil war, has in recent years tied its legitimacy to economic growth and lifting hundreds of millions out of poverty.

But China experts say that unless the new leadership pushes through stalled reforms, the nation risks economic malaise, deepening unrest, and perhaps even a crisis that could shake the party's grip on power.

Graphic on party congress link.reuters.com/fus73t

Video on party congress link.reuters.com/myr73t

Advocates of reform are pressing Xi to cut back the privileges of state-owned firms, make it easier for rural migrants to settle permanently in cities, fix a fiscal system that encourages local governments to live off land expropriations and, above all, tether the powers of a state that they say risks suffocating growth and fanning discontent.

The congress may also see cautious efforts to answer calls for more political reform, although nobody seriously expects a move towards full democracy.

Party spokesman Cai Mingzhao said on Wednesday there would be greater efforts at promoting "inner-party democracy" - in other words, encouraging greater debate within the party - but that one-party rule was inviolate.

"The leading position of the Communist Party in China is a decision made by history and by the people," he said. "Political system reform must suit China's national reality. We have to unswervingly stick to the right path blazed by the party."

And that path includes control over what people can see and hear in the news and on the internet.

"My internet has been cut off, I can't receive telephone calls and three people follow me when I leave the house to walk my dog," Xinna, the wife of one of China's longest-serving political prisoners, Mongol rights activist Hada, told Reuters.

"All I want from this congress is my husband to be released and for our lives to get back to normal," she said from her home in the frigid northern Chinese city of Hohhot.

A Tibetan rights group reported that three teenaged Tibetan monks in the southwestern province of Sichuan set themselves on fire on Wednesday in protest against Chinese rule, bringing to almost 70 the number of self-immolations by Tibetans in 18 months.

China has branded the self-immolators "terrorists" and criminals and has blamed exiled Tibetans and the exiled Tibetan spiritual leader, the Dalai Lama, for inciting them. (Editing by Nick Macfie and Raju Gopalakrishnan)