China’s Reform is Good for Canada As resolutions from the Third Plenum are implemented, the two nations can look forward to a deeper ‘win-win’ relationship
China caught the world’s attention in November. The Communist Party of China (CPC) held its Third Plenum of the 18th Central Committee from Nov 9 to 12, 2013. Upon its conclusion, the CPC Central Committee approved a decision on “major issues concerning comprehensively deepening reforms”. This decision is regarded as providing the “roadmap” for China’s reforms for the next decade, and will have a profound impact on China’s future. It also has positive implications for China-Canada relations.
So what are the plans and measures of the reforms?
The plenum sent out a clear message. China is determined to free up fixed mindsets, overcome institutional drawbacks, discard outdated ideas and shatter the grip of vested interests. The aim is to promote social fairness and improve people’s welfare. China wants each and every Chinese citizen to get substantial benefits from further development.
In the early days of China’s reform, Deng Xiaoping described China’s reform endeavor as: “crossing the river by feeling the stones”. Now, China’s reform has entered “deep water”. Any measure that threatens vested interests will meet resistance. This makes innovation with top-down design from the central government necessary. As a result, the plenum made a statement on combining “top-down design” and “crossing the river by feeling the stones”. The meeting emphasized improved decisionmaking and consensus-building. The newly founded Central Taskforce on Deepening Reform is, in effect, the “headquarters of reform”.
The plenum identified priority areas for deepening reform. An in-depth effort will build a modern and open market economy, transform government functions, deepen the reform of the fiscal and taxation system, and achieve balanced development in rural and urban areas. Arrangements were also made to advance socialist democracy, strengthen socialist political institution-building, enforce the rule of law, and apply stricter control and oversee the exercise of power. The plenum also covered reforms for environmental protection.
The plenum specified 300 measures for 55 reform tasks in 15 sectors. For example, the abolition of re-education through labor has already taken effect. China also began to adjust its family-planning policy. Meanwhile, the meeting provided a schedule to accomplish all the reform tasks and achieve conclusive results in key areas by 2020. This means the reform process will be measured, implemented and evaluated.
It is fair to say that this Third Plenum has sounded the clarion call for a new wave of reform in China. As the title of an article in The Economist puts it: “China paves the way for reform”. The reforms of the past 35 years have lifted China out of poverty and brought it closer to the rest of the world. Now, the second round of reforms from this plenum will revitalize the Chinese nation and make the “Chinese Dream” a reality for its 1.3 billion people. China’s new- round reform benefits Canada.
Deepening reforms will also create new and greater opportunities for China’s relations with the external world. It is estimated that in the next five years, China will invest an additional $500 billion in other countries, import over $10 trillion worth of products and send 400 million tourists abroad. Of these initiatives, Canada should receive a good share. We must seize the opportunity and work together to achieve a win-win outcome for our two countries and our two peoples.
With Canada having been China’s strategic partner since 2005, China considers Canada a very important partner in its efforts to achieve the aforementioned goals. Trade and investment flows between the two countries are already very strong. China is also Canada’s largest source of international students and its fastestgrowing tourist market. With China’s deepening reforms, more cooperation in the energy and resource sectors can be envisioned. Industries such as clean energy, information technology, aircraft and agriculture — where Canada’s strengths lie — will find enormous opportunities in China’s economic restructuring.
Canada’s competitive financial institutions are well positioned to claim their fair share of the expanded Chinese capital market. In 2010, China set a goal of doubling its per capita income by 2020, which would allow the Chinese people to seek better education, to travel overseas more and to purchase quality agricultural products, all of which mean more opportunities for Canada. The author is Consul General of the People’s Republic of China in Toronto.