Global Economics

Xi's New Reform Group Holds First Meeting


Chinese President Xi Jinping meets Claude Bartolone, President of the French National Assembly, at the Great Hall of the People in Beijing, on Jan. 23, 2014

Photograph by Goh Chai Hin/AFP via Getty Images

Chinese President Xi Jinping meets Claude Bartolone, President of the French National Assembly, at the Great Hall of the People in Beijing, on Jan. 23, 2014

Its formal name is the Central Leading Group for Overall Reform. On Jan. 22 in Beijing, its almost two dozen members, chaired by President Xi Jinping, convened for the first time. Because it is the newest of the Chinese Communist Party’s secretive lingdao xiaozu, or “leading small groups,” it’s unlikely that outsiders will ever know its operations in great detail. But following its first meeting, a rough picture has emerged.

First, and most obviously, is the critical role the small group is supposed to play in the leadership’s sweeping economic reform plan, announced at a key party meeting last fall. “The leading group gathering is the latest development of a reform blueprint put forward at the Third Plenary Session of the 18th Central Committee of the Communist Party of China in November,” said the official China Daily on Jan. 23.

Putting President and Party Secretary Xi Jinping in charge shows the importance the leadership has placed on the group’s role driving tough reforms, including integrating tens of millions of farmers into the cities, weaning local governments off their excessive reliance on debt and land sales, and allowing market-driven private enterprises a larger role in the economy. “Officials of the government should speed up their [reform] work and at the same time move forward with steady steps,” said Xi, while presiding over the meeting.

Like Xi, the three deputy chiefs of the group are all members of China’s elite seven-member decision-making body, the Standing Committee of the Politburo. They include Premier Li Keqiang and Vice Premier Zhang Gaoli, both in charge of economic matters, and Liu Yunshan, who is responsible for ideology and propaganda.

Having four of China’s seven most powerful party leaders inside the reform body is expected to help as it inevitably faces down state enterprises, princelings, and other powerful vested interests that may put up obstacles to economic changes. “As the reform continues to advance, interests of some groups will be further compromised,” warned Xi, while also calling for the setting of a timetable to “realize the reform targets,” reported the Global Times on Jan. 23.

While praising the overall performance of central and local authorities in cutting red tape and fighting corruption in the past few months, Xi “lamented that some government officials could not understand the importance of deepening reform and did not strive to improve their work,” reported the China Daily.

According to state media reports, the new group will have six separate departments, giving it responsibilities that appear to extend far beyond the economy. They include divisions for “Party construction” and “discipline and supervision”—both likely related to Xi’s efforts to rectify officials’ conduct and clean up rampant graft. Another is called “democracy and justice” (it’s not clear what policies it may push, but they probably won’t include direct elections) and sections on culture and on society.

Finally, one department will be called “economy and ecology.” Grouping those two topics together probably reflects the leadership’s awareness that more than three decades of runaway growth have created serious environmental problems and that future economic development must be more balanced.

Dexter_roberts
Roberts is Bloomberg Businessweek's Asia News Editor and China bureau chief. Follow him on Twitter @dtiffroberts.

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