China also needs political reform

Under tight security following what is believed to be anti-government terrorist attacks — a fiery crash of a car Oct. 28 in Beijing’s Tiananmen Square and then bomb blasts Nov. 6 in front of a provincial party building in Taiyuan, Shanxi Province — the Chinese Communist Party held its third plenary session of the 18th Central Committee from Nov. 9 to 12 behind closed doors. The meeting is held every five years.

The 205-member committee adopted a policy of thoroughly deepening economic reform and accelerating change in the nation’s economic development model.

The communique issued after the meeting said in part, “The core issue is to properly handle the relationship between the government and the market to enable the market to play a decisive role in allocating resources and the government to play its role.”

The current Chinese leadership led by President Xi Jinping appears to be determined to maintain the traditional political system. If Beijing pushes economic liberalization while holding on to its conservative political system, it is unlikely that it will succeed in resolving the contradictions that plague Chinese society.

The Chinese leadership needs to squarely look at distortions and instability brought by the country’s rapid economic development. It is reported that the richest segment of Chinese society enjoys income 242 times the income of the poorest segment. Apart from the rich and poor divide, China faces such problems as environmental disruption, real estate bubbles, overproduction, unhealthy financial systems and oligopolies by state enterprises at a time when the Chinese economy is slowing down.

The communique also said, “Both public and nonpublic sectors of the economy are important components of the socialist market economy and significant bases for economic and social development.” But clearly some groups including state enterprises have vested interests, creating obstacles to reform. The Chinese leadership faces the task of overcoming resistant forces within the party that are trying to undermine reform efforts.

The leadership plans to push deregulation so that the private sector can give full play to its power, thus stimulating competition in the market and expanding domestic demand. In the financial sector, it also plans to liberalize interest rates offered by banks to increase competition among them, gradually loosen control on the currency exchange system, improve surveillance on financial institutions and put a brake on the snowballing debts of local governments.

On the political front, Xi has pushed exposing of corruption and strengthening of discipline among bureaucrats. But it is stepping up control over mass media and the Internet to clamp down on free speech. Dissatisfaction is mounting among ethnic minorities as shown by the Tiananmen car crash, which was carried out by Uighurs. As part of efforts for political regimentation, the Central Committee decided to set up a state security committee.

But without allowing people’s wider participation in the political process and the establishment of free mass media, it will be impossible for Beijing to reduce popular dissatisfaction. China’s leaders should realize that economic reform must go hand in hand with political reform.

  • Osaka48

    As long as the CCP think they are on the correct path and don’t want to make meaningful and timely reforms, fine.

    It does seem that unelected governments are not sensitive to the voices and ‘petitions’ of its people.

    Let them have all the rope they need to hang themselves. Continuous and ongoing restrictions on press freedoms, freedom of speech, a corrupt judiciary, rampant corruption at all levels, health threatening pollution, isn’t a formula for stability within the ranks of educated, middle class citizens.

    China will make the bed that is has to sleep in…let’s not fret about their mistakes.