Deng `will not survive beyond March'

Speculation about the declining health of 90-year-old Deng Xiaoping reached a frenzy yesterday, adding to the volatility of stock markets in Hong Kong, Taiwan and China.

Reports in Hong Kong fuelled the rumours, which have been intensifying over the past two weeks. A front-page article in the Asian Wall Street Journal said that China's leader was in a coma. An unidentified Chinese source was quoted as saying: "He has been unconscious and is unlikely to live beyond March."

The Eastern Express, citing sources close to the Deng family in Hong Kong and China, reported that Mr Deng had suffered a stroke and was critically ill in hospital. The newspaper said he was close to a vegetative state. The Hong Kong Standard said top officials in Peking had been asked to forgo leave and stay in the capital during next week's lunar new year celebrations.

Speculation about Mr Deng's imminent death usually comes in waves, but rarely reaches this level. It has intensified following comments by his daughter, Deng Rong, to the New York Times a week ago which confirmed that Mr Deng's health had deteriorated and that he can neither walk nor stand unaided. In another twist for the conspiracy theorists, a Shanghai newspaper, the Liberation Daily, last week published the first updated photograph of Mr Deng for almost a year, showing a frail old man, wrapped up warmly in a chair on the eve of last October's National Day.

Assuming he is still alive, all eyes will now focus on the travel plans of his daughter, Deng Rong. She is due to leave Peking during the first week of February for Paris, on the first leg of a trip to publicise her biography, Deng Xiaoping, My Father. She is due in New York on about 14 February, and will fly back to Peking on 26 February. Any change to these plans would indicate the family has serious worries about Mr Deng's survival.

Scope for speculation has also heightened this week because of the apparent inability of the Chinese government to address convincingly Ms Deng's comments. The official Foreign Ministry statement is that "in general, for an old man in his 90s, Deng Xiaoping is in good health".

Such contradictions yesterday provoked a near 2 per cent fall, or 208 points, on the Hong Kong stock market, and a 3.42 per cent fall on the Taipei markets - though the pessimism was compounded by fears of US interest rate rises. The Shanghai "B" share exchange, however, ended the day a mere half a point down.

The Deng Rong interview suggested that the family had decided it was time for a little more candour.

It may also have been a way to prepare foreign investors for the likelihood that Mr Deng will not appear as usual on television on Lunar New Year's Eve, 30 January.

Domestic propaganda has concentrated on urging support for Deng Xiaoping, for his heir apparent, President Jiang Zemin, and for party discipline.

Chinese pirates, page 17