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By Chen Changsheng, DRC

2016-12-23

The four highlights of this year’s central economic work conference are of great significance.

First, a new economic policy framework is established in accordance with the economic performance featured by the “new normal”. The conference points out that the state of “new normal” is a major judgment made by the CPC Central Committee on economic situation, and that the policy system, guided by the concept of innovative, coordinated, green, open and shared development and with the supply-side structural reform as the guideline, is a major decision made on future central economic work. The central economic work has made adjustment toward the basic working methods i.e. while taking a problem-oriented approach and observing the economic bottom line, the Central Government will seek progress and keep economic performance stable.

Second, the implications of the supply-side structural reform are further clarified. The conference further stresses that the prominent contradictions and problems facing China’s economic operation is rooted in the major structural imbalance. The ultimate goal of the supply-side structural reform is to meet demand, its main direction is the improvement of supply quality and the fundamental way to realize the goal is to deepen reform.

Third, risk prevention and control are given first priority to the economic work. In this conference, it is repeatedly mentioned that the government should put the prevention and control of financial risks at a more important place. To ensure that no systemic financial risks should arise, the government is determined to deal with a number of risk issues, focusing on the prevention and control of asset bubbles, and the improvement of regulatory capacity.

Fourth, the government will establish a positive incentive mechanism as an important leverage to promote the economic work. In this conference, more emphasis is placed on fleshing out the positive incentive mechanism. The work enthusiasm and the entrepreneurial spirit are the two key measures to encourage cadres to carry on creative work. The entrepreneurial spirit should be promoted and cadres who are decent, daring, and determined to forge ahead should be awarded.

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