China vows 'decisive' role for markets, results by 2020

Tue Nov 12, 2013 10:21am EST
 
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By Jason Subler and Kevin Yao

BEIJING (Reuters) - China's leaders pledged to let markets play a "decisive" role in the economy as they unveiled a reform agenda for the next decade on Tuesday, looking to secure new drivers of future growth.

China aims to achieve "decisive results" in its reform push by 2020, with economic changes in focus, the ruling Communist Party said in a communiqué released by state media at the end of a four-day conclave of its 205-member Central Committee.

The self-imposed deadline for progress - rare for Beijing to lay out in such clear terms - together with the creation of a top-level working group and an emphasis on "top-level design", suggest a more decisive reform push by the administration of President Xi Jinping and Premier Li Keqiang than under the previous leadership.

They must unleash new sources of growth as the economy, after three decades of breakneck expansion, begins to sputter, burdened by industrial overcapacity, piles of debt and eroding competitiveness.

"You should look back in history. When Deng Xiaoping started the reform and opening movement, he actually did something very similar in nature, creating a very powerful working group," said Steve Wang, China chief economist with The Reorient Group in Hong Kong.

"These guys report direct into the power center of the Communist Party. This is definitely not something to be looked at as another layer of bureaucracy, this is something to speed things up, to make things more efficient."

The leaders also set up a state committee to improve security as Beijing seeks to tackle growing social unrest and unify the powers of a disparate security apparatus in the face of growing challenges at home and abroad.

While the statement was short on details, which prompted disappointment on social media, it is expected to kick off specific measures by state agencies over the coming years to gradually reduce the role of the state in the economy.   Continued...

 
A worker wields a hammer at a demolition site in front of new residential buildings in Hefei, Anhui province, October 19, 2013. REUTERS/Stringer