Xi's guiding words on reform push

Hu Shuli says with his comments on 'drastic mistakes', Xi was clearly warning against, not advocating, delays in implementing change

PUBLISHED : Thursday, 17 October, 2013, 12:00am
UPDATED : Wednesday, 16 October, 2013, 11:07pm

President Xi Jinping's keynote speech at the Apec summit this month was to the point, laying out clearly the policy directions for Chinese reforms that will probably form the theme of the all-important third plenary meeting of the party's 18th Central Committee next month.

Nevertheless, one part of the address stoked fevered debate online about its meaning. Xi said: "China is a big country. It cannot afford to make drastic mistakes on fundamental issues, for such mistakes cannot be rectified or reversed."

Few in the audience in Bali who heard this thought the comment was worth highlighting. But back at home, many internet users jumped on it, and much of the speculation about what it meant was negative and pessimistic. The contrast in treatment reflects Chinese people's longing for reform and their fear that it will come to nothing.

The key is what Xi meant by "fundamental issues".

There were three major parts to his speech: first, he set out China's foreign policy in the Asia-Pacific; second, he addressed global concerns about the Chinese economy; third, he pledged the country's commitment to comprehensive, fundamental reforms.

The people at home were mainly concerned with the third point. Here is what Xi said. The government was drafting a "master plan for reform", clearly a reference to the blueprint to be unveiled at the plenum. He spoke of the "overall purpose of pushing forward reform in the economy, politics, culture, society, the environment and other fields, and adding new momentum for the economic development through reform".

China must undertake structural reforms if it was to progress, Xi said, and highlighted seven areas for change. He acknowledged the challenge of reform, but said the country must seize the opportunity for change and press on without fear or hesitation. This was the context for his comment on "drastic mistakes on fundamental issues", which was followed by: "We must take a bold stand and a steady approach; we must dare to take action, though not without careful consideration. We must be sure of our direction of reform and opening up - enduring the pain of change, and taking on the danger and intractable problem we meet along the way - to ensure the smooth and steady progress of reform and opening up."

Clearly, "fundamental issue" here refers to the national strategy of reform and opening up, and "drastic mistakes" can be interpreted in two ways: one, meaning China cannot afford to stall or roll back its reform efforts; and, two, their execution must be patient to avoid irreparable mistakes. A thin line separates success from failure; in pushing for change, a big nation must be bold yet cautious.

Xi's speech was intended to reach business and economic leaders around the world. They have two main worries about the Chinese economy: one, whether it is heading for a crash; two, whether the country's structural reform and the transformation of its growth model will proceed as planned. Xi directly addressed these concerns by assuring them of China's confidence in its prospects for growth and the government's commitment to carrying out reform.

Unfortunately, some commentators took their analysis of Xi's words too far and concluded that they were in fact anti-reform and anti-West.

What is the cause of such misinterpretation? At heart, it reflects people's doubts that reform and opening up is the right path for China. At every step of the country's road to opening up, interest groups have opposed such efforts and seized on people's fear of change to create a false mood of nostalgia for the "good old days". As a result, many people have begun to doubt if reforms are truly needed for China and if the government's resolve to undertake them is truly firm.

Xi's speech in Bali will help to dispel some of these doubts.

Since the 1990s, China has twice launched landmark policies to perfect its model of a socialist market economy. The third plenum of the 14th Central Committee in 1993 made the key decision to build a socialist market economy. A decade later, at the third plenum of the 16th Central Committee, party leaders agreed to improve it.

This year, we have reason to expect government leaders to take the next step; after building the basics of a socialist market economy, China must now turn its attention to its wider economic, political, cultural, social and ecological environment, and institute holistic reform for all.

Xi's call for action befits the moment. As he said, China must be bold enough to endure any pain, face up to any danger, and take on any intractable problem that it meets along the path of reform. This should be the China spirit that guides not just its leaders but all citizens.

This article is provided by Caixin Media, and the Chinese version of it was first published in Century Weekly magazine. www.caixin.com