Chinese officials push for more reforms in economy - cautiously

Chinese officials affirmed Monday that Peking will push through more economic reforms during the 13th Communist Party Congress, easing controls on prices and granting more autonomy to managers of state enterprises. However, the two senior economists declined to specify how extensively Peking will yield power to directors of state factories and free market forces to determine prices.

Their vague comments illustrate the caution of Chinese reformers as they seek a party mandate for policies that have sparked unprecedented inflation and provoked opposition from Marxist ideologues and advocates of strict central planning.

In the hands of reformers, the decontrol of prices has proved to be a two-edged sword. The policy has created inflation of more than 8 percent but forced factory directors to upgrade efficiency.

Advocates of reform, facing opposition within the party and strong public discontent over price increases, have upheld a conflicting policy aimed at furthering decontrols while stabilizing prices.

In an effort to restrain inflation, Peking will ensure that the money supply corresponds with the economy's growth rate and price increases, and that wages rise with productivity, said Gao Shangquan, vice-minister of the State Commission for Restructuring the Economy. But he said the congress will particularly emphasize a reform aimed at eliminating waste in state-run enterprises, the laggards of the Chinese economy.

Peking will allow managers to compete for contracts to run publicly owned factories and ``instill greater vitality in the enterprises,'' Gao said. Peking spends millions every year to support the inefficient plants.

In the countryside, the congress will enact nationwide an experiment that has allowed some peasants to rent out land that they have leased from the government, said Du Runsheng, director of the Secretariat's Rural Policy Research Office. Such a subleasing plan would enable Peking to enlarge the average size of cultivated acreage and would permit peasants to leave their land for the booming rural industrial sector, helping Peking to harvest the same amount of grain with less manpower.

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