New type of bureaucrat needed for a new task
Updated: 2014-06-06 08:12
By Ed Zhang (China Daily Europe)
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It will take time and many changes of the guard before economic transition is accomplished
Why must China always have others guess about its next move? Why are there doubts in the global business media about China's chance of making a successful transition in its economic model, as its leaders have famously pronounced?
One reason is that onlookers all expect instant results. But in a big country's major undertakings, no result can be had so soon.
As recent developments in China have revealed, the transition of an economy won't pass its point of no return until the country has welcomed an entire new generation of economic officials. It wouldn't be a transition in just economic significance.
A report on the government website Gov.cn, posted on June 3, explains much of the inevitability.
The report quotes Premier Li Keqiang speaking at the State Council executive meeting on May 30: "I've noticed on my field trips at the grassroots level that there are places where government officials just fail to do their job.
"Some of them would rather not do a stroke of work so long as there isn't any problem to disturb them. And some regard it as their best achievement if only they can just get by."
Then Li stressed: "If I'm allowed to be more straightforward, I would say what ineptitude this is." Such ineptitude and laziness are also corruption, he said.
What the premier meant by grassroots level could be any level below his office. He reportedly became emotional when he asked those who represented various State commissions and ministries: "Have you all implemented State Council policies? Have you each taken your responsibility? Or should I remind you of your duty?"
Such a reproachful remark led China Business News, a domestic publication, to speculate that Li must have pounded the conference table when he was saying it.
Whether he did doesn't really matter. What matters are the implications for investors.
First, it seems that from the central level down, some officials still can't follow the ideas of the leaders who assumed office one year ago, or what the Chinese call the Xi (Jinping)-Li (Keqiang) team, referring to the country's president and premier.
Many Chinese officials are qualified development officials. You could call them GDP officials. They have learned to boost the GDP in one area by investing heavily in local public infrastructure and offering sweet terms to big investors, especially manufacturers of export products.
But the economy's transition now requires something different, in which the growth rate is no longer the primary target. It highlights competence in running a more service-oriented government, a more level, competitive market, more small enterprises, and more spending power from middle-class consumers (because of better protection of the terms of their social security).
Secondly, in many ways, the transition actually requires a government that is decentralized in some ways - and at the same time more centralized in other ways.
It is definitely a new game that many government entities, in order to work with private sector investors, have to learn debt financing of local investment projects. This is done through bond issues and working in an open securities market, with various third-party agencies bound by international practices.
At the same time, these government entities would have to accumulate a greater deal of financial management expertise.
This would require a new type of official - that is, with a new mind set and new skills - apart from the current campaign to root out corruption in State-monopolized industries and State-owned enterprises.
Thirdly, as GDP is no longer very useful, there are some new indicators as to whether desired changes are faster or slower in a particular area. One can do so by just checking the number and activity of non-state financial services, schools, hospitals, farms and Internet companies.
Officials will have to explore new ways of running the government to help all these grow.
After all, no transition can be quick. China's abandonment of a Soviet-style planned economy took as long as 15 years before the phrase "market economy" was written for the first time in an official policy paper in 1993. In the process, nearly all government offices had a changing of the guard, with thousands, if not millions, of officials retired. That is a lesson from history.
The author is editor-at-large of China Daily. Contact the writer at edzhang@chinadaily.com.cn
(China Daily European Weekly 06/06/2014 page13)
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