Insights on the "China 2030" Report

by Mark W. Frazier
February 28, 2012

Mark Frazier, University of Oklahoma, offers his insights on how proposals for reforms advocated in the World Bank’s report on “China 2030: Building a Modern, Harmonious, and Creative High-Income Society,” released on February 27, 2012, can be achieved given the current political climate in China.

The question on everyone’s mind after the release of the World Bank’s report on China 2030: Building a Modern, Harmonious, and Creative High-Income Society is how the bold proposals for structural reforms in industrial, financial, fiscal, and social policies can be achieved given the political facts of life and obstacles posed by powerful defenders of the status quo.

There is little doubt that some in the Chinese leadership and their advisers from the Development Research Center (which co-authored the report with the World Bank) believe that current conditions are unsustainable, and indeed threatening, if not addressed with deeper reforms. What the study’s authors cannot say, since political advice is outside their charter, is that the proposed reforms stand little chance of succeeding without substantive political and institutional reforms. Bold leadership and commitment to implementation at the top are ineffective without other essential ingredients to pursue such an ambitious reform agenda. These include more transparency and public access to official documents and information, as well as greater participation by various groups (associations, NGOs, etc.) in the policy process at local levels.

A curious and recurring phrase in the report that hints at the latter is “equality of opportunity.” Some might read this as an insertion of a phrase used by American conservatives into the Chinese context, but the report authors use it differently. They call for equal access to public services by the “outsiders” of China’s political economy: rural populations, migrant workers, private firms, and others. In a section on social policy, “equality of opportunity” refers to giving outsiders the ability to gain access to public education, basic health insurance, pensions, and other social programs, regardless of their residency status (hukou).

Similarly, private entrepreneurs should have access to credit on equal footing with state-owned enterprises. But more importantly, the phrase connotes public participation in the design and delivery, and the oversight, of basic public services. This is an important suggestion for participation, oversight, and accountability by citizens and civil society organizations. In short, the authors invoke greater participation by the public as a means to fulfilling the ambitious reorientation of China’s development strategy.

Yet even if grassroots participation becomes a way of monitoring local officialdom and promoting reforms to social services and development, many of the reforms called for in “China 2030” would require a political realignment within the Chinese Communist Party that no one foresees happening any time soon. The World Bank and other international organizations offer a great service when they provide officials within the PRC government with ideas and agenda-setting capabilities, and “China 2030” does that. But China’s most important and enduring reforms have come from local experiments and initiatives that top officials decide to popularize nationwide.

On the World Bank Website

Access the report and related resources including transcripts of World Bank Group President Robert B. Zoellick’s opening remarks and media questions and answers: The World Bank: China

On CNTV’s English Language Service

Watch video of a discussion of the report featuring Ding Yifan, Development Research Centre of State Council, and a western analyst: China 2030: A high-income society

In The Economist

The economics of reform: Stoking the furnace