Experts: Difficult to Implement the Spirit of the Third Plenum Press Conference

On July 19, the Chinese Communist Party held a press conference to interpret the relevant content of the Third Plenary Session. The carefully selected questions by the authorities touched on the concept of “implementing measures with the spirit of driving nails”. Experts analyzed that the authorities strongly hope to solve problems with this approach, explaining the difficulties in implementing reforms and the abrupt ending.

The press conference for the Third Plenary Session was chaired by Mo Gaoyi, Deputy Minister of the CCP Central Propaganda Department and Director of the State Council Information Office, and attended by six officials from various departments including the Central Compilation and Translation Bureau, the Central Financial and Economic Affairs Commission, and the Education Ministry.

The official introduction stated that the Third Plenary Session passed the decision “On Further Comprehensive Deepening Reform and Advancing the Modernization of China by the Central Committee of the Communist Party of China” (referred to as the “Decision”), consisting of 15 parts, 60 clauses, and divided into three main sections: an introduction discussing the significance and requirements of reforms and advancing the modernization of China, reforms in various aspects of the economic system, and strengthening the Party’s leadership on reform.

Although the full text of the “Decision” has not been made public yet, the press conference arranged after the Third Plenary Session, with carefully designed questions by the CCP, shed light on the specific content of the final clause, the 60th clause.

When asked about the heavy task of implementing reform, Tang Fangyu, Deputy Director of the Central Policy Research Office, revealed that this is the final and crucial clause among the 60 in the “Decision”. He quoted Xi Jinping, saying, “Without earnestly implementing the reforms, no matter how good the goals and blueprints are, they are just like flowers in a mirror and the moon reflected in the water.”

He emphasized that “the deeper the reforms go, the more complex and sharp the conflicting interests become, and the harder the tough nuts are to crack. Each step forward is not easy.” He stressed that only by putting in “greater efforts in implementation” from top to bottom, can they “overcome various obstacles and break through the entrenched interests.”

Gong Xiangsheng, Deputy Researcher of the Institute of CCP Military and Operational Concept Studies at the Taiwan Institute for National Defense Studies, told Dajiyuan, “They do recognize the challenges in further reforms. With the widening wealth gap in China post-pandemic, the extreme inequality in economic fruit distribution represents obstacles to deepening reforms and achieving common prosperity, inevitably facing resistance from vested interests.”

He also mentioned that ordinary people have long been exploited, with some becoming rich first, leading to exploitation between industrial and agricultural sectors, urban and rural areas, all rooted in long-term structural issues.

Wu Se, Researcher at the Cross-Strait Policy Association and a consultant for Taiwan’s think tank, expressed to Dajiyuan that the “spirit of driving nails” seems to emphasize the hope to implement reforms by 2029. However, the challenge lies in how to actualize so many tasks, especially considering the complexities of intertwined interests at various levels that make reform difficult. Additionally, setting the target year of 2029 adds pressure.

He further elaborated that currently, China faces daunting challenges such as local debt issues, fiscal imbalance, and resulting financial risks. Implementing reforms involves economic development and resource allocation, making it a tangled and intricate process. Thus, the emphasis on “driving nails” may seem like 10% planning and 90% implementation, but in reality, it might end up being the other way around or drastically different.

He emphasized that China’s greatest economic development challenge stems from the CCP’s party-state system. Under such a dictatorial regime, achieving comprehensive reforms is extremely difficult. He believed that relying solely on top-down policies without corresponding actions might lead to premature or superficial conclusions.

Observers believe that many CCP officials are in a state of passivity, lacking the motivation to act. Yuan Hongbing, a liberal legal scholar studying in Australia, previously told Dajiyuan that he understands that most CCP officials are displaying three attitudes: widespread discontent, a passive “lying flat” approach, and outwardly showing extreme loyalty to Xi Jinping while privately expressing dissatisfaction. He referred to them as “two-faced” individuals according to Xi Jinping’s standards.

In a year-end special feature by the CCDI and the National Supervisory Commission’s website on December 30, 2021, it was revealed that from January to October 2021, about 247,000 cases of ineffective implementation of Xi Jinping’s “important instructions” and “major decisions and deployments of the Central Committee” were rectified nationwide.

When a member of the media at the press conference raised concerns about the current global uncertainties affecting China’s reform and opening up efforts due to the turbulent world situation, Mu Hong, Deputy Director of the Central Compilation and Translation Bureau, responded that external uncertainties would not hinder China’s deepening reforms. He claimed that the “Decision” specifically addresses opening up to the outside world, including expanding institutional opening-up, reforming the foreign trade system, foreign investment, and overseas investment management, sending clear signals to expand high-level openness.

However, Gong Xiangsheng argued that China is bound to be influenced, as its unfair trade practices have prompted not only countermeasures from the United States but also scrutiny from the EU on China’s trade policies. The EU requested China, during a WTO meeting on July 18, to stop advocating for special treatment for developing countries and urged for more transparency. The EU also criticized China’s distorted industrial policies, which could negatively impact international industries.

He further analyzed that despite China’s intention to expand openness, there are limits due to the CCP’s emphasis on achieving “high-quality development and high-level safe interactions,” where security takes precedence over development. Consequently, unrestricted entry of foreign capital and corporate governance into the Chinese market might face resistance.

Gong Xiangsheng stressed that the so-called external uncertainties from international backlashes arise from China’s emphasis on security and control, forming a vicious cycle.