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China begins talks on economic reform

Photo: AFP
4 min

Chinese leaders began a four-day meeting in Beijing Saturday to set an agenda of economic reforms over the next ten years, with finding a more sustainable growth model for the world’s second-largest economy likely to be a top priority.


China's ruling Communist Party began a key meeting Saturday to dictate the direction of the world's second-biggest economy for the next decade.

The official Xinhua news agency said the gathering of the party Central Committee would discuss a draft document on "major issues concerning comprehensively deepening reforms" in the Chinese economy, a key driver of regional and global growth.

Recent reports in party and state media have singled out key issues at the four-day meeting as potentially including land and administrative reforms, as well as reducing protections for powerful state-owned enterprises.

A government think-tank, meanwhile, called for dismantling the residency registration system known as "hukou", which restricts access to medical insurance and other benefits for migrants.

China also faces important issues including oppressive air and environmental pollution, and how to retool its economy to ensure more sustainable growth.

The party gathering, known as the Third Plenum and which takes place amid intense security and secrecy, has traditionally set the economic tone for a new government, and past meetings have been used to signal far-reaching changes.

It comes a year after China embarked on a once-a-decade leadership transition, with Xi Jinping taking over as party general secretary before becoming state president in March.

Although the economy is no longer completely party- and state-controlled, the ruling body holds huge sway, with officials in charge of key elements, such as the exchange rate, that in other countries are left mostly to markets.

Xinhua said the party draft document "pools the wisdom of the whole party and from all aspects" and is expected "to advance the reform that has lasted for more than three decades".

The agency, however, reported no concrete details.

China's leadership recognises that the country's economic growth model, largely based on state-financed investment, needs to give way to one in which consumers and other private actors take the lead in propelling expansion.

But changing direction is no easy task given entrenched interests and ways, as well as the economy's increasing complexity.

Xinhua had recently proclaimed that the plenum "is expected to be a watershed as drastic economic policies will be unveiled".

Analysts, however, have expressed scepticism and say broad brushstrokes rather than firm details are more likely to emerge from the meeting after it concludes Tuesday.

"Expectations are not very high for the economic reform blueprint which will be spelt out at the plenum," Willy Lam, an expert in Chinese politics at the Chinese University of Hong Kong, told AFP.

"This is because Xi Jinping has emphasised the values of stability and also incremental changes."

China most notably signalled major reforms at a Third Plenum in 1978, when it embarked on the landmark drive that has seen it transformed over the past three decades from a Communist-style command economy into a key driver of global growth, trade and investment.

However, Lam said: "Intellectuals in Beijing are not very optimistic that the reforms introduced at the weekend will be as forward-looking and sweeping as those introduced by Deng Xiaoping 35 years ago."

The People's Daily newspaper, the official party mouthpiece, firmly rejected any Western-style political reforms on the eve of the gathering.

The party "must uphold its leadership... in the face of some people in society who advocate imitation of the Western system," the paper said Friday in a full-page editorial.

The meeting of the full 376-member Central Committee is believed to be taking place at a closely guarded private hotel in Beijing.

Security in the form of uniformed and plainclothes police was tight as a stream of black sedans with tinted windows could be seen entering the venue.

Police were preventing vehicles with non-Beijing license plates from proceeding on the city's main thoroughfare toward the hotel, according to an AFP photographer at the scene.

The meeting comes less than two weeks after a fiery vehicle crash along the same avenue in front of Tiananmen Square, the symbolic heart of the Chinese state, that killed two tourists and wounded dozens.

The government has described the incident as "terrorism" and blames separatists from Xinjiang, the far-western province that is home to the mostly-Muslim Uighur minority.


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