Rule of law gets top billing at key meet

Deng's anniversary celebrations raise prospects for a slew of further reforms

Getting the China picture is not easy because many things can happen at the same time in the country, and people may have different interpretations of each event. But this is also why China-watching can be interesting.

The past few days are a case in point. One sensational item of news followed another: from the country's largest antitrust penalty (1.2 billion yuan, or nearly $200 million) levied on 12 Japanese auto parts suppliers to the central leadership's decision to regulate (for the first time in the reform era) executive pay in all large, state-owned enterprises; from corruption probes of four top officials from the Chinese customs office in Shanghai, which followed a report that 84,000 officials were disciplined for their performance failures in the first half of the year, to a decline in home prices, due to sluggish sales, in nearly all mainland cities. And there were still more.

These developments are all important. But which one, as one may ask, is the most important? Which one indicates more growth or less? A rise in the stock market index or a fall? And which represents the national trend, and is likely to produce a lasting influence?

The intriguing thing is that seemingly unimportant news for regular investors can actually mean a lot more than it appears - judging by its timing, and importance given in the domestic press, and names of the officials involved.

On Aug 20, a meeting was held in Beijing before the 110th anniversary of the birth of reform's "chief architect", Deng Xiaoping. It was a rare occasion attended by all members of the Politburo Standing Committee, the highest political body in China.

More importantly, President Xi Jinping gave a lengthy 9,700-character speech on Deng's political legacy, especially his leadership in China's attempt to build an economic and political model that is different from either the former Soviet Union or the way China was during the "cultural revolution" (1966-76).

Why Deng? Why now? Why such a high-level presence? It must have been seen as a moment that the leadership could not afford to miss, a highly symbolic occasion for it to demonstrate to the public, with all seriousness, its commitment to the reform line that Deng pioneered.

Deng has become the ensign of China's market-oriented reform and the pragmatism (the attitude of "seeking truth from facts") behind it. Invoking him can raise the public's expectation for a new charge in the direction he pointed out.

Chinese commentators already consider the Deng anniversary as part of the preparation in the run-up to the Fourth Plenum of the Communist Party of China's 18th Central Committee, scheduled for October.

The Third Plenum last November resulted in a comprehensive and ambitious 60-point reform program. And the theme for the forthcoming Fourth Plenum, as officials announced earlier, is to strengthen the rule of law.

It would be the first time, said the commentators, for the Communist Party of China to list the issue at the top of the agenda of its Central Committee's full session, after it pledged in 1997 that it would govern China according to law. The very fact also reflects the inadequacy in the development of rule of law in the past 17 years, said Zhou Ruijin, a political commentator active in the 1990s.

Seen from this perspective, the Deng factor should be rated the most significant for the last week for observers of both Chinese politics and economy. It means the reform, rebooted last year, is in no way running out of steam despite the many tasks it still has to tackle.

One can be almost sure that from now to the last few weeks of the year, Beijing will roll out still more reform policies. And along with those reform policies, there will continue to be some small rallies in the stock market. The policies will also help investors to identify where potential growth will be.