China resolves to check gov't power

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Government omnipotence, which has become an obstacle to efficiency after powering China's staggering growth in past decades, is expected to be addressed in reforms outlined by the country's new leadership for the next decade.

The market is widely anticipating plans on the transformation of government functions to be formed at the upcoming Third Plenary Session of the 18th Communist Party of China Central Committee, which is renowned as a springboard for major national reforms.

"Letting the government manage everything had the merit of efficiency at a time when China's economic aggregate and private production were both severely under-developed," said Chi Fulin, head of the China Institute for Reform and Development.

But it has lost its advantage in today's market economy, he added.

An official opposition

The Chinese government, local authorities in particular, with their role as decision-maker, investor, franchiser, regulator and supervisor all in one, has oriented the growth of the economy, which awed the world with two-digit expansion in the past 30 years.

This model, which once won widespread praise because of its efficiency, has now become a target of public complaints, as it has interfered excessively with the market and society.

For example, in Zhengzhou City of central China's Henan Province, an expectant mother surnamed Zhang has made 20 visits to the local residential community this year in order to obtain a birth certificate for her soon-to-be-born baby.

For Kong Lingmin, a project manager at a real estate development company in south China's Hainan Province, the biggest headache was the need to deal with lots of different government departments to complete the acceptance process for a project, although the time taken for this has recently been reduced from six months to 10 working days.

What's worse, such practices have also led to pivotal issues like overcapacity, environmental pollution, the local government debt crisis and market malfunctions, raising the stakes for a weakening economy that has already faltered amid global economic woes.

Against the backdrop of today's economy with its diversified players, the government-led growth model has increasingly hindered China's ongoing economic restructuring efforts, according to Chi.

The old growth model has left Chinese government with little choice but to carry out reforms that start with itself, added Wang Xiaoguang, a researcher at the Chinese Academy of Governance.

Growth of the world's second-largest economy eased to 7.7 percent in the first three quarters of the year.

Top-down reforms

But there are signs that efforts to foster a more rational relationship between government and the market will be accelerated under the reign of the new leadership.

At a press conference held in March right after the usher-in of the new leadership, Premier Li Keqiang compared reducing government power to "cutting one's own wrist" to demonstrate his resolve to transform government roles.

The metaphor echoed a Chinese legend in which a courageous warrior severed his snake-bitten wrist to keep the poison from spreading all over his body.

During a September economic forum, Li stressed that the key to economic reform is to balance government, market and society, and let the market play its role to induce more vitality.

Past years have seen consistent efforts in China to adjust the role of the government. A total of seven institutional reforms of the country's central authorities have been carried out since China started its reform and opening-up drives in 1978.

Though noticeable progress has been made during this process, analysts believe there is a long way to go for Chinese government to become a de facto limited government.

"Today's reform is more difficult compared to 10 years ago," said Ding Yuanzhu, a researcher from the China National School of Administration, citing more entrenched interest groups.

The central government has scrapped more than 200 administrative approval items this year, but it still holds another 1,500. Approval items in the hands of local governments stand at as many as 17,000.

To target any of these powers means that the interests of some groups will inevitably be hurt, which puts the reformers' determination and courage to the test, according to Ding.

"Reform at the present stage is in essence carrying out reforms on the reformers themselves," said Chi. "By setting the brave warrior as an example, Chinese reformers have to emulate his courage and decisiveness, without which reforms are not likely to make headway."

"The key lies in reforming the mindset of the cadre team," believes Ding. The spirit of reforms will percolate down and gain traction when cadres really understand and implement the reforms demanded by the central government, he added.