On October 11-14, 2003, the Third Plenary Session of the 16th CPC Central Committee was held in Beijing. The session heard and discussed a work report delivered by General Secretary Hu Jintao at the entrustment of the Political Bureau of the CPC Central Committee. It also deliberated and approved the Decision on Issues Regarding the Improvement of the Socialist Market Economic System and the Proposal on Revising Part of the Constitution of the PRC, and decided to submit the two documents to the Standing Committee of the 10th NPC for deliberation.

In a crucial period of China's reform and development, the plenum centered on the improvement of the country's socialist market economic system, putting forward a series of new ideas and perspectives set to give strong impetus to the ongoing economic restructuring.

The CPC Central Committee decision worked out the guidelines and basic principles for deepening the economic restructuring, that is, taking the Deng Xiaoping Theory and the important thought of the "Three Represents" as the guidance, implementing the Party's basic lines, programs and experiences and putting into thorough practice the spirit of the 16th National Party Congress; emancipating the mind, seeking truth from facts and keeping abreast of the times; persevering in the direction of economic restructuring to build the socialist market economy and laying emphasis on institutional construction and systems innovation; respecting people's initiative and giving full play to the enthusiasm of both the central leadership and localities; properly handling relations between reform, development and stability, and pressing ahead with reform in a focused and studied fashion; streamlining various interest relations in the reform process in light of unified planning with due consideration for all concerned; and being firm on the "people first" principle and pursuing comprehensive, coordinated and sustainable development in the aim of achieving an all-round progress of economy, society and humanity.

The decision also listed the objectives and tasks for improving the socialist market economic system. Aiming to coordinate development in both urban and rural areas and in different regions, integrate economic and social development, achieve harmonious development between man and nature and coordinate domestic development and opening up to the outside world, it is of essential importance to give bigger play to the fundamental role of market in resources allocation, increase the vitality and competitive edge of enterprises, improve state macro-control and enhance the government's functions in social management and public service, so as to prepare strong institutional guarantees for building a moderately prosperous society in an all-round way. In this process, major tasks include: improving the basic economic system of keeping public ownership as the mainstay of the economy and allowing diverse forms of ownership to develop side by side; narrowing the gap between urban and rural areas; promoting coordinated development of different regions; establishing a unified, open and orderly modern market system; setting up better macro-control, administrative and economic legal systems; improving employment, income distribution and social security systems; and, establishing a mechanism encouraging sustainable social and economic development.