The Chinese Communist Party will hold the 20th Third Plenum in July. In recent days, the authorities have sent out contradictory messages, signaling intentions to reform the economic system while also strengthening the Party’s control. A recent meeting of the CCP’s Deepening Reform Committee emphasized the Party’s “leadership” over state-owned and private enterprises, sparking discussions. Overseas scholars believe that the Third Plenum aims to redefine “reform and opening up.”
According to Xinhua News Agency, Xi Jinping, who also serves as the director of the Central Committee for Comprehensive Deepening of Reform, chaired the 5th meeting of the Central Deepening Reform Committee on June 11. One of the agenda items was to “improve the modern corporate system with Chinese characteristics.”
Official statements mention the promotion of “separation of politics and business,” but they also stress the need to “strengthen the Party’s leadership” and “improve the institutional mechanisms for Party leadership over state-owned enterprises,” while emphasizing the role of Party building in private enterprises.
Independent commentator Cai Shenkun expressed concerns on social media, pointing out that the focus of the official statements is on strengthening the Party’s leadership. He argued that by prioritizing Party control, it becomes impossible to establish a modern corporate system, respect entrepreneurs’ autonomy, attract and retain talent, separate politics from business, protect private property, and nurture world-class enterprises.
Cai further noted that the contradictions in the high-level CCP meetings indicate that the upcoming Third Plenum in July is unlikely to bring significant breakthroughs in reform discussions.
Commentator Zhong Yuan wrote an article for a media outlet stating that if the Party fully controls enterprises, they cannot have an independent status in their operations. While officials talk about encouraging certain private enterprises to establish modern corporate systems and emphasize the role of Party building, the decisions on the corporate system should be left to the entrepreneurs, not dictated by the CCP. The very existence of the CCP poses the greatest obstacle to China’s economic development.
An internet user commented that terminologies like “Chinese characteristics” imply a departure from universally recognized definitions. For example, “Chinese characteristics modern corporate system” could mean a system that is not modern.
During a meeting on April 30, the CCP Political Bureau expressed enthusiasm for “reform and opening up” ahead of the upcoming Third Plenum in July. However, on May 23 during his visit to Shandong, Xi Jinping emphasized the importance of upholding the Party’s comprehensive leadership in any reform efforts and asserted that fundamental aspects must remain unchanged.
Analysts anticipate that the key agenda of the upcoming Third Plenum will still focus on advancing reforms in the economic system.
An expert familiar with Chinese politics, Yuan Hongbing, remarked that the initial intention of the authorities for the 20th Third Plenum was to center it around a political struggle, featuring public criticisms of Jiang Zemin’s capitalist restoration, as a means to bolster Xi Jinping’s image as a savior of the CCP, possibly even reintroducing the position of Party Chairman for Xi’s lifelong rule.
Yuan revealed that due to internal disagreements among Xi’s inner circle, the focus shifted to addressing economic issues after establishing Xi’s absolute authority through handling the Taiwan situation. Hence, the Third Plenum transformed from a political affair to tackling economic challenges.
Regarding the recent contradictory messages from the authorities regarding reform and strengthening Party leadership, Yuan explained that the Third Plenum aims to achieve three goals. Firstly, it seeks to redefine the essence of reform and opening up as a facade to divert attention back to Mao Zedong’s original ideological path.
Secondly, the Plenum aims to strengthen and solidify the dominant position of state-owned enterprises, establish an internal economic circulation system, and prepare for potential challenges, especially in facing off against the U.S. in the Taiwan Strait.
Lastly, the CCP intends to use the guise of reform and opening up to deceive the international community once again.
The stance towards private enterprises has always been a barometer for the CCP’s “reform” direction. Yuan noted that a significant portion of private businesses in China collude with various factions within the CCP, leading to the recent crackdown on private entrepreneurs. The authorities seek to groom a new set of private enterprises to be future targets for exploitation, hence the need for policies favoring their development and encouraging foreign investments once more to present a deceptive image of reform and opening up to the world, hoping for international appeasement toward the CCP’s authoritarian rule.