Intriguing reference to privatisation results in many raised eyebrows

Few expected any news from China's top legislator, National People's Congress chairman Wu Bangguo, when he delivered his annual address last week. But Wu, who ranks No 2 in the Communist Party hierarchy, raised quite a few eyebrows with some intriguing remarks on the state of the nation. Among other things, he said China would not carry out privatisation given the country's guoqing, a vague term that literally means the special situation in China that is often used to justify things that set China apart from the rest of the world. In his statement, Wu also used the Chinese negation word bugao, a tense-less verb meaning 'not to do something'. 'On the basis of China's conditions, we have made a solemn declaration that we will not employ a system of multiple parties holding office in rotation; diversify our guiding thought; separate executive, legislative and judicial powers; use a bicameral or federal system; or carry out privatisation,' Wu said. While top mainland leaders routinely slam the notion of separation of powers and other core values of Western-style democracy, it is rare for them to speak out against privatisation, which is widely seen as having been at the heart of market-oriented economic reforms over the past three decades. Wu's assertion in such brief yet unequivocal language took almost everyone by surprise, with many leading mainland observers and economists voicing their confusion and demanding clarification. Some even doubted his choice of words, suggesting it might have been a slip of the tongue. Others say that is unlikely because such an important address, delivered to nearly 3,000 deputies and broadcast live on state television, would usually be subject to prior approval by the top leadership. Prominent economist Mao Yushi says Wu's remarks are confusing and do not make much sense because the mainland's economic success can largely be attributed to privatisation. Private ownership has grown strongly, with many small and medium-sized state-owned enterprises, mostly in less efficient heavy industrial sectors at local levels, sold off. The number of registered private enterprises on the mainland topped 8.4 million last year, accounting for 74 per cent of the country's total, according to state media. By some accounts, private enterprises account for as much as 75 per cent of the mainland economy, 75 per cent of state revenue and nearly 80 per cent of new job opportunities, according to a report last year by the Communist Party mouthpiece People's Daily. Many analysts believe Wu's remarks are generally aimed at putting a brake on renewed discussion on political reform. Beijing has been unnerved by repeated anonymous online calls for pro-democracy rallies in big mainland cities over the past four weeks in the wake of the popular revolts that rocked the Arab world. toppling regimes in Egypt and Tunisia. One Beijing-based analyst says Wu's underlying message amounts to saying a resolute 'No' to calls for democracy that have also been prompted by Premier Wen Jiabao's pledges last year to push ahead with long-stalled political reform. Professor Zhu Lijia, from the Chinese Academy of Governance, says Wu's harsh remarks on privatisation did not come as a complete surprise given the fierce opposition that has long existed among party conservatives towards private ownership because of concerns about the loss of state assets and the creation of millions of laid-off workers. Indeed, the People's Daily and another party mouthpiece, Qiushi magazine, have published several articles denouncing privatisation over the past two years, echoing an ultra-orthodox view that tends to blame privatisation for the collapse of the Soviet Union and the Communist bloc in Eastern Europe. But that does not necessarily mean Beijing wants to deny or see a rollback of previous reform. Rather, it is largely a direct response to mounting public calls for privatisation of land rights, especially in rural areas, and further reforms in state-owned sectors that would see the breaking up of state monopolies in key industries such as telecommunications and railways. 'Apparently, the public have a lot of grievances about the negative impact of the monopolies on their livelihoods and the collusion between the government and business interests at the expense of public interests,' Zhu said. Analysts said Wu's remarks would inevitably raise further questions about whether the government still stood for the people or had joined hands with powerful interest groups. China's reform has reached a critical juncture, with the thorny issues of how to distribute wealth and the benefits of economic growth more evenly becoming the most daunting challenge for the government. 'Making empty promises or volatile or even provocative statements will not help appease widespread discontent,' another mainland analyst said. Wu's remarks on privatisation are also another attempt by Beijing to reaffirm that China remains a socialist country despite its pursuit of a market-oriented economy and the subsequent yawning wealth gap, amid widespread criticism that China has embarked on a path of capitalist development. 'Of course Wu has to say things like that. Otherwise, China can no longer be viewed as a socialist nation,' Zhu said.