Gov't retreats from business intervention

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Last updated at: (Beijing Time) Friday, March 12, 2004

Gov't retreats from business intervention

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When describing his successful joint venture with Japanese partner Nissan at the national legislature's session earlier this week, a top Chinese car maker Miao Wei didn't expect that President Hu Jintao would chip in and ask: "Do you need to get a government approval if you plan for a technical innovation?"

"The President is keen on providing a favorable environment for domestic enterprises to grow," Miao, general manager of China's Dongfeng Automobile Co., Ltd., also NPC deputy from Hubei Province, told Xinhua Thursday.

To the dismay of government officials present at the conversation, Miao didn't hesitate to voice his complaint before the President.

"Of course!" he said. "Sometimes we have to wait for half a year to get an approval from the central government departments concerned if the renovation plan involves import of foreign equipment."

Hu turned to the government officials present, saying, "We do feel it's an urgent need our government transform its work style from intervening in enterprises' business operations to providing them with service, timely and efficient."

"Whether or when a technical upgrade is needed is up to the companies, not the government," said Miao, raising his voice a little bit.

As a clear signature of the new generation of China's central leadership that took office a year ago, "serve the enterprises" has evolved from the Chinese Communist Party's 6-decade-old sloganof "serve the people" when the nation is moving on the road to build a well-off society in an all-round way.

In his government work report delivered to the National People's Congress, or the Parliament, last Friday, Premier Wen Jiabao dedicated four pages to the transition of government functions, something never done by any of his predecessors.

"The key functions for the government should be macroeconomic control, market supervision, management of public affairs and service to the general public," Wen said later in a panel discussion with the lawmakers.

China has been making painful efforts to downsize its government institutions over the past decades. After cutting the payroll of central government departments by half under the leadership of former premier Zhu Rongji, township governments across the country were also reduced to 39,000, or 37 percent fewer than in 1998.

"Four township governments were dismissed every day in China," said Ying Songnian, a deputy to the National People's Congress andtop law professor with the State Administration College.

However, "the transformation from issuing administrative ordersto providing public service is nothing easier than downsizing," said Prof. Ying, noting that with vested interests, government departments are reluctant to give up their power in making decisions for enterprises "even if they feel they are short of hands."

Before embracing a largely freewheeling "socialist market economy" in the 1990s, China had long adopted a strictly-planned economic system copied from the former Soviet Union, under which the government oversaw everything from business operations of enterprises to cradle-to-grave welfare of the people.

"Many government officials today are still unable to abandon their outdated mindset fostered under the planned economy," Prof. Ying said.

Jin Zhiguo, lawmaker and chairman of the board of Shandong-based Tsingtao Brewery, said that complicated government procedures in passport application just foiled his latest attempt to go to Thailand in February for business negotiation.

"Under the existing rules, it takes at least three months for me to obtain government approval for a business trip to Taiwan, " he said, making a self-answered inquiry "Who can wait for such a long time for a fleeting business opportunity?"

As a matter of fact, the overall situation for the business community has been improving over the years, said Ding Haizhong, an NPC deputy and Party secretary of Ma'anshan City of eastern Anhui Province, noting that local government agencies have been urged to provide help for enterprises.

"Even if they (the enterprises) have loopholes in their management and operation, what the government should do is to helpthem straighten things out, but not deliberately create troubles or even attempt to 'profit' from this," he said.

Government bodies and employees must be feeling the heat not only from the leadership, but from the people as well. Otherwise, they may face slews of lawsuit accusations because of a law on administrative license is to take effect on July 1.

The new law, covering the government's right to grant franchises, permits or certificates to businesses and individuals,drastically simplifies the procedures for approvals and abolishes unnecessary restrictions, Prof. Ying said. When an approval requires the go-ahead of different government departments, they should jointly set up a special office to provide the applicants with one-stop service, he added.

"What we are busy doing is reviewing our current practice in case we'll be brought to court and have no chance to win," said LiChengyu, an NPC deputy and governor of central China's Henan Province.

Along with improvements in China's legal system, the political will of the central leadership to build a government for the people has gradually been turned into action, an encouraging development which analysts say is in keeping with the pursuit of the Party and government over the past six decades. Enditem

Source:Xinhua

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