[By Jiao Haiyang/China.org.cn]

Chinese Premier Wen Jiabao commented in early February that, amid the current global economic uncertainties and domestic mechanism flaws, reform and opening up is still the key to all problems. Premier Wen made his comments on his visit to Guangdong Province, the bellwether in China's reform and opening up drive since 1978.

"China's reform and opening up should be pushed forward unswervingly to ensure continued progress and prevent stagnation," said Wen, citing former Chinese leader Deng Xiaoping who delivered a famous speech when inspecting south China 20 years ago.

Yi Xianrong [File photo]

Reform and opening up, in its general sense, refers to the transformation and improvement of the existing social, economic and legal systems, as well as the incentive and restraint mechanisms, so as to emancipate and develop the forces of social productivity and fuel social and economic development. This has ensured China's continuous progress over the past 34 years.

As I stated years ago, Deng's biggest contribution to the country lies in ensuring that each and every citizen can have and gradually expand his or her own social and economic rights through the reform and opening up drive, which also helps to establish and improve various mechanisms. Through institutional arrangement, Deng created opportunities for his people to get rich and fulfill their dreams of self-development. People from all walks of life can thrive under the institutional framework, if they possess sufficient intelligence and diligence. This is unquestionably the driving force behind China's economic development, and the key to raising individuals' standard of living. In this sense, reform and opening up means that the government, through institutional arrangement, offers its people equal opportunities to enjoy more social and economic rights.

However, over the past decade or more, the stagnation and subsequent outdatedness of the reforms have resulted in great changes, both in terms of how people generate wealth and their concepts of wealth creation. An increasing number of people, especially the young, dream of getting rich overnight, rather than through sustained, long-term personal efforts. Seized by this desire for instant wealth, more individuals sought quick returns either through collusion with those in power, speculation or family inheritance. Under such an institutional framework, there is unequal access to resources, making it impossible for ordinary people to get rich through their own efforts. The logical conclusion of this is that society as a whole will lose its impetus to develop further.

To solve this problem, the most important countermeasure is to ensure the continuous expansion of universal social and economic rights through sound institutional arrangement. To this end, efforts need to be made in various areas. For instance, the government should gradually lift the unreasonable urban household registration system to help farmers and residents in small and medium-sized cities move freely and have equal access to education in any city. The education system should also be transformed to ensure that all citizens receive an equal standard of education. Meanwhile, the official appointment and dismissal system should be holistically reformed in order to combat corruption, and address the problem of officials' privilege where job opportunities are concerned.

However, it should be noted that any reform means a significant institutional transformation that will lead to the redistribution of vital interests among all stakeholders. Such an adjustment can help elevate social wellbeing and individual livelihoods through the release and development of the forces of social productivity, although the welfare distribution may be uneven to some extent due to the leverage of the market economy. However, this doesn't imply any serious problems as long as equal opportunities are open to all. Therefore, it is logical to conclude that if equal opportunities are not open to all, the adjustment of vital interest relations in the reform and opening up will be stuck in a vicious cycle.

China's reform and opening up is facing major challenges as a result of obstruction from groups with vested interests. The adjustment of vital interests in the process of reform and opening up may be a zero-sum game, as the major institutional reforms will transfer certain people's interests to other people. In such circumstances, classes and groups possessing vested interests will take different measures to obstruct the reforms. The bubble-stricken real-estate market, in which the instant extravagant profits are snapped up by only a few, is a good example of this. When the interest distribution structure of the market is marked for change, these profiteers will surely reject, or at least obstruct reforms through various means and seek to legalize their unjustifiable assets.

To conclude, reform and opening up has remained the driving force of China's sustainable and sound economic development. Reform and opening up, with its original goal of ensuring the gradual expansion of people's social and economic rights, has been endowed with a new purpose implication: Providing equal opportunities for all, as well as breaking down groups possessing vested interests to prevent them from legalizing their vested interest. This may be the basic meaning of the "reform and opening up" stressed by Wen.

The author is a researcher with the Institute of Finance and Banking under the Chinese Academy of Social Sciences.

This post was first published in Chinese and  translated by Zhang Junmian.

Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.

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