Opinion

Observers: China determined to tackle challenges

By Zhang Haizhou and Zhang Chunyan (chinadaily.com.cn)
Updated: 2010-10-19 22:24

LONDON – The communiqué, released on Monday after the Fifth Plenary Session of the 17th CPC Central Committee, shows Chinese leaders' determination to shift towards better growth and tackle social problems, according to observers.

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But Beijing has still a long way to go to achieve social justice and narrow China's wealth gap, both difficult missions, said experts.

"China will further boost people's incomes, enhance social construction, and deepen reform and opening-up," said the communiqué.

China's GDP growth will continue to be strong and, in terms of productivity, China will perform well, said Kerry Brown, a senior fellow at London-based Royal Institute of International Affairs.

While the key growth targets will be set in the annual National People's Congress session next March, it is clear that China will attach more emphasis on the quality of growth, Qu Hongbin and Sun Junwei, economists from HSBC global research, said.

"Policymakers put steady and sustainable growth the most important objective, with structural adjustments and reforms as the policy tools," Qu and Sun said.

To rebalance growth by encouraging consumption and shifting some of it from coastal to inland regions, Beijing must push forward its reforms in income distribution, taxation and fiscal spending, industrial regulations and financial markets in the coming years, Qu and Sun added.

Having read through the communiqué, Lu Yiyi, an expert on Chinese politics and social development at the London-based Royal Institute of International Affairs (or Chatham House), said China's leaders are determined to tackle social injustice and China's widening wealth gap. But implementation is a challenge, added Lu.

"When you are trying to boost the incomes of the poor, you may find the incomes of the rich increase even faster," said Lu. She said China is now entering a difficult period of reform.

"As society grows more diversified, it's hard to simply have a policy that satisfies all," said Lu.

Any measure that works in some area may have negative side effects in others, she added.

"An internal strategy to improve China's social security system and medical reform is more important and must balance any protective, possibly confrontational, external strategy," said Alex Mackinnon, an international strategy consultant and co-author of China Calling: A Foot in the Global Door and China Counting: How the West Was Lost.

Bridging the 'wealth gap' will take domestic strength not international power, added Mackinnon.

"It (China) is looking at rebalancing the economy much more, addressing some of the lack of social infrastructure in the less developed areas and trying to marry the huge wealth of some of the country and some sectors of the population with the large amount of poverty that still exists," said Brown.