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Calls for reform body in China

Updated: 2013-01-26 22:22
By Fu Jing (
The new leadership should "seriously consider" setting up an overarching institution to design China's reform agenda to redefine the boundaries of the government, said an influential Chinese economist.

"Only through decisive reform and clearly defining the role of government can China's tough difficulties at home be eased," Fan Gang, director of the National Economics Research Institute of China Reform Foundation, said at the annual World Economic Forum.

"And the new leadership should consider setting up such an overarching institution to design the timetable and roadmap."

Fan's recipe came as the participants here have shown great interest in the policy agenda of China's new leadership, which was elected last November at the 18th National Congress of the Communist Party of China.

The participants said they learned about the personalities of the new leadership, including Xi Jinping and Li Keqiang, through massive media reports, which are encouraging.

Fan said the new leadership has so far shown determination in fighting corruption and advocating reform, which are "to-the-point." "But the new policy portfolio needs time to take shape, and I think in March, when the new government is formed, more economic and social policies will be increasingly churned out."

Fan said it is crucial to set up an overarching reform institution to coordinate a reform agenda, which now is mainly implemented through the National Development and Reform Commission (NDRC). Nearly 10 years ago, China had a ministerial-level institution, which was under direct supervision of the central government and the premier, to design and implement a reform roadmap and agenda.

"Currently, the reform institution (a department under NDRC) is facing mounting difficulties to coordinate interests of each sector (ministries), mainly because of its lower authority."

Fan said the Chinese government should reform itself first by stepping back from too much administrative approvals, pricing and economic activities. "It should find its proper roles in maintaining smooth economic growth, offering public goods and social welfare in a market economy," said Fan.

Anil Gupta, professor of strategy and entrepreneurship at the University of Maryland in the US, said China's new leadership has shown a lot of confidence, which is a very good starting point.

"For example, Xi Jinping is very confident, very decisive, and very direct in what he wants to say both externally outside China and internally in China," said Gupta at the forum. "Because of his clear communication, it is easier to interpret what he said, and he means what he said."

Going beyond the leadership's personal profiles, Gupta said the outside world still wants to know more about China's economic agenda and its policies to maintain economic growth. Also, in a society connected by social media, how the new leadership tackles social problems is a challenge, according to Gupta.

Meanwhile, Gupta said, the world is also eager to know about the leadership's measures to solve regional disputes and maintain regional security.

Orit Gadiesh, chairman of Bain & Co, a leading international strategy consulting firm, said her expectation toward the new leadership is to maintain "open-minded" attitudes, and she is confident they will do so.

"We see the huge potential and confidence over China is not only from surprising changes in infrastructures but also from the attitude changes over the last decade," said Gadiesh, who is chairwoman of the international advisory body of Shanghai Municipality.

Gadiesh said she was among 14 multinational CEOs to offer suggestions for Shanghai at the annual meeting. "We presented our papers and also had constructive discussion with the mayor," said Gadiesh, adding that Han Zheng, now Party secretary of Shanghai, has paid close attention to their proposals.

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