China reveals far-reaching Third Plenum reform details

Author: Mike Paterson | Category: News

Author: Mike Paterson

Well, some more headlines for the moment anyway but it’s more detail than we’ve had so far

They plan to:

  •  greatly reduce govt intervention in resource allocation
  •  improve property rights protection system
  • loosen family planning restrictions
  • transfer some state assets to national social security fund
  • raise dividends paid by SOES to 30% by 2020
  • abolish labour camp system
  • let local govts broaden financing channels
  • let local govts issue bonds
  • reduce capital punishment ” step by step”
  • scrap residence restrictions in small cities
  • lift restrictions on residence registration in orderly manner in mid-size cities
  • integrate urban and rural social security systems
  • push forward price reforms in resource sectors
  • accelerate capital account convertibility process
  • speed up interest rate reform
  • establish deposit insurance system
  • expand consumption tax to cover polluting products
  • speed up property tax reforms
  • quicken resource tax reform
  • push forward environmental tax
  • maintain balanced structure between local and central govt revenues
  • collective owned land to have same rights status as state land
  • encourage overseas investment by individuals and companies
  • remove barriers on private firms entering some specific sectors
  • encourage private firms to take part in SOE reform
  • standardize system of managing local and central govt debt
  • set up debt risk alert mechanism
  • establish exchange market for property rights transfers
  • select more cities to develop free trade zones

Plenty to consider here.. the reforms are far reaching, as they had previously indicated they would be, but we shall need to see the final detail, and they will need to be delivered still of course.

Chinese leaders have promised “decisive” results by 2020

I’ve highlighted some key headlines but they all have a significance in the bigger picture

Markets will be pleased to see this further release though for sure

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