China to launch revamp with merged ministries Go back »

2008-03-05 | All chapters

China to launch revamp with merged ministries
Richard McGregor, Financial Times, 4th March 2008

China will launch a shake-up of government at the annual session of its top legislative body, with the formation of “super-ministries” intended to streamline administration and reduce meddling by minor bureaucrats in state businesses.

The long-term structural reform of government will be discussed alongside more urgent tasks facing China’s leadership – in particular, the battle against inflation, now at an 11-year high.

Wen Jiabao, the premier, will open the National People’s Congress with his annual "state of the union” speech on Wednesday, in which he will outline the administrative reforms and the government’s policy priorities for the year.

In the wake of the ruling Communist party congress last year, which selected the leadership for the next five years, the NPC will also usher newly promoted officials into their formal posts.

The government has yet to announce the make-up of the new ministries but officials and scholars in Beijing said the focus would be on streamlining those dealing with transport, industry, energy, telecommunications and the environment.

"The idea of ‘big ministries’ stems from Chinese leaders’ wish to ensure directives passed by party and state authorities in the capital will be enforced by local-level administrations, which are skilled at diluting Beijing’s instructions,” said Jörg Wuttke, president of the European Union Chamber of Commerce in Beijing.

Mao Shoulong, a public policy expert at Beijing’s Renmin University, said the shake-up was part of an effort to bring Chinese governance into line with international norms. The changes were aimed at separating executive decision-making from regulatory and enforcement activities, functions often still handled within the same agency. “It means that ministries will not be able to run their own enterprises,” Mr Mao said. “The power will no longer be centralised in one person.”

The proposed new bodies have all run into opposition, especially the proposal for an energy ministry, which is likely to be delayed after lobbying by state-owned oil and power companies.

The State Environment Protection Agency, a weak factor in a bureaucratic Beijing packed with officials who prioritise speedy economic growth, is expected to become a full ministry.

"This would be consistent with Beijing’s efforts to begin enforcing its anti-pollution regulations and signal increased pressure on heavy industry to comply or close, which means even greater pressure on margins,” said Andy Rothman, an economist for CLSA, the brokerage.

Mr Mao said merging a number of ministries would make the state council, China’s cabinet, a more effective body for Mr Wen, the premier, as China now had “too many levels of administration within the state council”.