The fall of Bo Xilai, former party secretary of Chongqing, has raised concerns among China observers. Early last month, his right hand man and Chongqing police chief, Wang Lijun, went to the American consulate in Chengdu and stayed there overnight. It remains a mystery why Mr Wang did that, but what is clear is that the incident has led to Mr Bo’s sacking.
His fall signals that the party will continue on its pragmatic and centralist policy set long-ago by Deng Xiaoping. It has now been widely recognised that the reform process stalled in the last decade. However, it was a key theme in Mr Wen’s address to the recently-concluded annual People’s Congress. It seems that this was not just lip service, but would be backed by real actions.
The recent ‘China: 2030′ report by the World Bank supports the thesis that the government is back on the path of reform. Among other recommendations, it calls on China to seriously reform its state-owned enterprises. The report is a joint effort between the World Bank and China’s executive branch. So the reform agenda is at least endorsed by some key sections of the government.
To see real changes, though, one may have to wait until the Communist party concludes its 18th congress and a new leadership takes shape in October. But the recent political developments and policy changes have raised hopes that reform is back on the agenda. Continue reading »