Determination for deeper changes

But after 30-plus years of reforms, what remains to be done are mainly "the hard nuts to crack", as China's new leaders put it when talking about the difficulty of pushing ahead with further reforms. However, Li's government has not flinched in front of the difficulties and instead taken a larger stride toward giving the market a decisive role in the distribution of resources to better handle the relationship between the government and the market.

Shortly after he took office in March 2013, Li decided to scrap or delegate to lower-level authorities some administrative approval power, and a total of 416 items that require administrative approval have so far been canceled or transferred from the central government to lower levels of government.

This year, another 200 items will be slashed, Li promised in his report. Given reducing or transferring such powers will touch on some vested interests, this is a substantial step toward plucking up the courage to push forward deeper and more sweeping reforms like "a warrior daring to cut his wrist" or "a fight to win or die" as Li has described it.

The recent abolishing or delegating of powers released some of the vigor of market players and helped the country manage to achieve 7.7 percent economic growth in 2013 despite the adverse economic circumstances it faced both at home and abroad.

But without further reforms, it is certain there will be no further progress. After three decades of economic and social development since the launch of reform and opening-up, China has become the world's second-largest economy and it has achieved remarkable progress in poverty alleviation. However, the country still faces a widening gap between the rich and poor and a series of inequalities between urban and rural areas, issues that will fuel public discontent and seriously affect social stability and harmony if not ironed out.

The firmly entrenched monopolies of State-owned enterprises in some areas has also resulted in unfair competition, with the more dynamic but smaller private sector having to play second fiddle. If this is not changed, this will have a detrimental effect on the country's economic vigor and global competitiveness. There are hopes that all these problems can be resolved through more deepened reforms by Li's government in the time ahead.

Li's government also holds a long perspective on economic development and it has been rational and restrained when considering temporary stimulus measures to boost the economy. The reduced administrative interventions into national economic development and especially the restive housing market, as vowed by Premier Li in his report, are also expected to help China resolve economic issues through economic means, instead of through the administrative means that cause big fluctuations.

The author is a senior writer with China Daily. wuyixue@chinadaily.com.cn

(China Daily 03/07/2014 page10)

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