China Economy

Next premier Li Keqiang sets out case for reform

Li Keqiang tells local officials country will have to rely on reform to achieve economic goal of a 'moderately prosperous society'

PUBLISHED : Friday, 23 November, 2012, 12:00am
UPDATED : Monday, 30 May, 2016, 5:00pm

The man who will become premier next year has made a strong case for reform just days after the unveiling of the Communist Party's new leadership, saying reform is the biggest dividend.

Li Keqiang, speaking at a seminar with selected local officials on Wednesday, organised by the State Council, said China would still be able to see the completion of a "moderately prosperous society" by 2020 even with a lower economic growth rate of about 7 per cent a year, China News Service reported.

"We do not blindly pursue gross domestic product growth and it is very likely that our future development will go through a period of moderate growth rate that can hardly stay in double digits," he said. "To achieve the goal [of building a moderately prosperous society], we'll have to rely on reform, which still has enormous scope and potential to be explored."

Analysts said the remarks by Li, 57, who was elevated to No 2 in the party hierarchy last week and will succeed Premier Wen Jiabao in March, could be viewed as a strong political message calling for bolder reform.

Professor Hu Xingdou, a Beijing-based analyst, said: "It is very encouraging to see that our next premier has shown strong support for reform despite all the difficulties we have encountered and the disputes about the future direction of the country.

"But we have yet to hear his appeal for bolder political reform, which has become the real cause of many of China's political, social and economic woes."

Li's remarks appeared to echo the key development goals laid out by President Hu Jintao in his farewell speech at the opening of the party's 18th national congress this month.

Hu unveiled the blueprint for China to become a moderately prosperous country by 2020, with average household incomes doubling.

Li appeared confident about realising those ambitious goals. "We have to move ahead and there is simply no way back," he said. "We can only rely on further reform and opening up to improve the people's livelihood."

He reiterated the importance of intellectual emancipation, a slogan frequently used by the late paramount leader Deng Xiaoping , and admitted that pushing for further reform would mean tackling powerful vested interests.

"[We need to] break with the existing pattern of inherent interests and readjust public expectations about possible benefits, which requires not only political courage and insight, but also wisdom and systematic training and knowledge," he said.

Li named a long list of challenges and problems, including disparities between different regions, the disparity between rural and urban areas and the yawning wealth gap.

He said the crux of breaking the reform deadlock and solving all sorts of energy, resources and environmental bottlenecks lay in finding the right balance between government and the market. "In economy, [we should] give a greater role to the market, which can efficiently allocate resources," he said

Many analysts said Li, a protégé of Hu, knew the importance of striking a balance between political and economic reforms.

Hu Xingdou said: "I think Li has made it clear that he wants to push for bolder reforms, which certainly includes political reform, but it remains to be seen if those words can be followed through, and particularly if he can get the necessary support from the entire new leadership."