BEIJING — It took just three days after its recent third plenum meeting for the Chinese Communist Party to issue its blueprint for major reforms in the country. The fact that the content of the resolution it had agreed upon was released so quickly demonstrates both the importance of major economic reforms here and the Chinese central government’s commitment to fully executing them.
Here is a summary of the resolution’s most important content:
Though reform is at the core of the document, the ultimate goal and the reasons for the reforms are clearly outlined. The aim is to improve the Chinese-style socialist system and promote the modernization of China’s governing system.
The document outlines the need for institutional reform so that China can move toward a more mature market economy. Though the country has made remarkable achievements in the past 35 years as it has gradually moved from a planned economy to a market one, institutional shortcomings and deep-seated problems have increasingly indicated that reform is imperative.
The nature of the document is very concrete. It specifies actionable policies about property rights, profit management, fiscal reform, etc.
It also contains some suprises that neither the market nor the public foresaw. For example, it stresses systems for family planning, deposit insurance, comprehensive personal income taxes, and increased property rights for farmers. It also proposes that Chinese enterprises and individuals be allowed to make foreign investments, and it suggests adjustment to the judicial system. Many past controversial issues are addressed, and the proposed solutions are far more open than expected.
To ensure a smooth process, authorities decided to set up a leading group to take charge of the overall reform design and coordination. This is also the most innovative point of this third plenum of CPC central committee. This authoritative coordination illustrates the Chinese leaders’ determination to carry out the reforms — while at the same time showing the challenge of the reforms.
Chinese leaders have also established a timetable for completing reforms. All key areas are to achieve decisive outcomes by 2020. Of course, executing these reforms will require selflessness and almost limitless knowledge and information. In other words, achieving further structural reform isn’t going to be easy.