CAUTIOUS ON STATE-OWNED ENTERPRISES While the party effectively upgraded the importance of markets in its philosophy - previous policy statements often described markets as playing only a basic role in allocating resources - it also made clear that it had no plans to radically reduce the role of the state in the economy. State-owned enterprises, which now control large swathes of the economy, will continue to play a leading role, even while the government creates more room for private enterprise by opening up more industries to private capital, it said. Among the issues singled out for change, the party said it would work to deepen fiscal and tax reform, establish a unified land market in cities and the countryside, give farmers more property rights, and develop a sustainable social security system - all seen as necessary for putting the worlds second-largest economy on a more stable footing. Today, expanding the urban population to help transform the economy to one that is led more by consumption is being thwarted in part by a rigid residence registration system. The system ties entitlement to public services, such as pension, healthcare insurance and free public schooling, to home villages and towns. That makes it hard for the migrant workers that Beijing wants to encourage to move and work in cities to become full-fledged urban dwellers and consumers. Restrictions on farmers from selling their land also impede this process, leaving many caught between the city and village. HUNGRY FOR DETAILS Out of a long list of areas the meeting had been expected to tackle, most analysts singled out a push towards a greater role for markets in the financial sector and reforms to public finances as those most likely to get immediate attention. As part of that, Beijing is expected to push forward with freeing up the movement of capital in and out of China. The 2020 target date for making significant strides on reform could fuel expectations the government will be looking to achieve breakthroughs in freeing up the closely managed yuan by then. Still, some observers were skeptical about just how far its efforts would go. Top billing is given to granting markets a decisive role in resource allocation, which could mean a great deal, or very little, Mark Williams, chief Asia Economist with Capital Economics in London, wrote in a note. The reaction on Chinese social media was broadly of disappointment over the lack of details. What is there to be said about the third plenum? Having read it, it feels like not having read it at all - there are no details, no regulations, said one user named Yu Chunxi, who says he works for a state-run asset management company. Even with its new focus on central co-ordination of reform efforts, Beijing will likely face stiff resistance from those who benefit from the status quo - powerful heads of state companies to local officials who can benefit, often through graft, from the current focus on land sales and infrastructure investment. Few China watchers had expected Xi and Li to take on powerful state monopolies, judging that the political costs of doing so were just too high. Many economists argue that other reforms will have only limited success if the big state-owned firms stranglehold on key markets is not tackled. But instead, the focus will be on indirect steps to limit the power of state behemoths and open up space for nimbler, private and foreign rivals - opening up markets to private and foreign investment and deregulation tested in free trade zones. Beijing also predictably drew a line in the sand about how far it was willing to go on reforms - while it would move towards a more market-oriented economy and seek to weed out corruption and onerous bureaucracy, it would not entertain serious political reforms, or change the flag, as it put it. (Additional reporting by Aileen Wang, Natalie Thomas, Shao Xiaoyi and Li Ran in BEIJING, Fayen Wong in SHANGHAI, and Hong Kong newsroom; Writing by Jason Subler and Tomasz Janowski; Editing by Neil Fulli NEW IRAN SANCTIONS WOULD RISK WAR, WHITE HOUSE WARNS The White House has warned US lawmakers that tightening sanctions on Iran could derail a diplomatic drive for a nuclear deal with Iran, boxing America into a march to war. The remarks Tuesday marked a significant toughening of President Barack Obamas stance towards Congress on sanctions as Washington prepares to resume high-stakes nuclear diplomacy with Iran later this month. The US president has vowed he will not allow Tehrans leaders to develop an atomic weapon, but last weeks negotiations in Geneva between Iran and six world powers failed to reach an interim deal to halt its program. Fresh from the talks, Secretary of State John Kerry heads to Capitol Hill on Wednesday to make the case for continued diplomacy. Key senators from both US parties, some responding to Israels savaging of the proposed agreement, are proposing stiffer sanctions or may curtail Obamas power to ease current measures, which have crippled the Iranian economy. But the White House said any new sanctions could scupper the diplomatic process and leave little option but the use of military force against Iran. The American people do not want a march to war, White House spokesman Jay Carney told reporters, saying US citizens justifiably and understandably prefer a peaceful solution that prevents Iran from obtaining a nuclear weapon. This agreement, if its achieved, has the potential to do that. The alternative is military action, Carney said. If pursuing a resolution diplomatically is disallowed or ruled out, what options then do we and our allies have to prevent Iran from acquiring a nuclear weapon? The White House believes in offering Iran some modest and reversible steps to ease the pain of some sanctions as part of an interim deal to bolster Tehrans negotiators against hardliners who are skeptical of new President Hassan Rouhanis diplomatic opening. But many US lawmakers believe that tightening sanctions will give the administration more leverage -- and doubt Tehran is serious about standing down its nuclear program. Republican Senator Mark Kirk maintains that sanctions are the best way to avoid war. The American people should not be forced to choose between military action and a bad deal that accepts a nuclear Iran, he said. White House aides, however, privately say that once war-weary Americans understand the alternative to a deal with Iran means another Middle East conflict, they will warm to Obamas approach. Tehran denies Western claims it is trying to develop a nuclear weapon. Kerry will take the administrations position directly to the Senate Banking Committee, which is mulling a new sanctions package. The secretary will be clear that putting new sanctions in place would be a mistake, State Department spokeswoman Jen Psaki said. What we are asking for right now is a pause, a temporary pause in sanctions, she told reporters. We are not rolling them back. GET DETAILED AT tarsiernews/foreign-news.php
Posted on: Thu, 14 Nov 2013 14:06:57 +0000
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