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China Pushes Ahead with Market-Orientated Government Framework
China made a great stride forward in streamlining its government institutions with Monday's announcement of axing nine state administrations.
The move is the most significant one in recent years in China's efforts to push ahead with government institutional reform, and a continuation of the reform plan drawn up by the State Council in 1998, experts noted.
Sheng Huaren, minister in charge of the State Economic and Trade Commission (SETC), announced that nine administrations which formerly oversaw the sectors of internal trade, coal, petrochemical, building materials, non-ferrous metal, machine- building, textiles, metallurgical and light industries have been closed down, with related administrative functions shifted to the SETC.
Sheng described the goal of this reform as "highlighting the functions of comprehensive departments while diminishing the role of direct administration," and "enhancing macro-control while reducing government interference in enterprises' operations."
Liu Haifan, vice-president of the Party School of the Communist Party of China Central Committee, commented that the reform demonstrates the central government's strong will to deepen government reform despite difficulties.
China executed a major government institution reform in 1998, reducing the 40 ministries to 29, and degrading a number of ministries in charge of economic sectors to administrations under the SETC.
Many of these ministries had a history of five decades, and played very a significant role under the old planned economy.
"The reform marks a further step both in separating government functions from those of enterprises and in promoting the reform for a market economy, compared with the reform in 1998," Liu said.
"In reshuffling its internal departments, the SETC enhances the role of comprehensive departments while abolishing some departments directly overseeing enterprises, a major move to realize the separation of government functions from those of enterprises," Liu added.
A streamlined and highly efficient government that runs according to the requirements of the market economy is crucial to the deepening of China's economic restructuring, Liu noted.
Various government departments in charge of China's economic operation are now shifting their role from directly managing enterprises to providing policy instructions and supervision. Related policy restrictions on enterprises will be eased soon, according to Sheng.
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