1. Premier Wen Jiabao: Objectives and Policies of New  Cabinet
2. U.S. Economist: China Capable of Resolving Its Financial Problems
3. China’s New State Leaders Elected
4. China’s New Cabinet Members Approved


Summary

Meeting the press on March 18 in Beijing, new Chinese Premier Wen Jiabao said that China’s new cabinet should continue to maintain a sustainable and comparatively rapid development of the national economy and improve people’s living standards.  To realize the strategic economic restructuring and continue to open up to the outside world are the two key policies his cabinet will follow.

Speaking at the China Development Forum on March 24 in Beijing, Martin Feldstein, an U.S. professor of Economics in Harvard University said that China had favorable conditions and correct polices to resolve its major financial problems including bad loans and social security pensions.

On March 15 deputies to the 10th National People’s Congress elected China’s new state leaders in Beijing.

Chinese lawmakers approved members of the State Council of China on March 17.

1. Premier Wen Jiabao: Objectives and Policies of New  Cabinet

            China’s new cabinet should continue to maintain a sustainable and comparatively rapid development of the national economy and improve people’s living standards, new Chinese Premier Wen Jiabao said when he met the press on March 18 in Beijing.

            This is “one goal” the new cabinet will strive to achieve, the premier said, adding that it is vital for the government to maintain continuity and stability of policies and stick to the policy of expanding domestic demand and implement the proactive fiscal policy, in order to achieve the goal.

            The new premier put the work of his cabinet in a nutshell of “four phrases,” namely, to “achieve one goal,” “implement two key policies,” “solve three major economic problems” and “promote reforms in four major aspects.”

            The two key policies are to realize the strategic economic restructuring and continue to open up to the outside world.

            The three major economic problems are how to solve unemployment and social security system, how to increase fiscal revenue and cut public spending, and how to correct and standardize the economic order.

The “reforms in four aspects” refer to the reform of the rural economy, the reform of state-owned enterprises, the reform of financial system and the reform of governmental agencies.

            Wen said that rural reform covers rural taxation system, grain purchase and sales, subsidies to farmers, the rural financial system and rural medical and health service.

             The premier said China will continue to take state-owned enterprise reform as the central task of the overall economic reform, aiming at establishing a modern corporate system, and in the meantime, China will promote the reform of the system for managing state assets.

              He said that while establishing and improving the financial regulation system, his government would take steps to speed up the reform of state-owned financial enterprises so as to establish a modern financial enterprise system in its true sense.

            The premier laid out a number of principles necessary for achieving the above objectives.

           He stressed the necessity of giving priority to the development of agriculture and rural economy, and of promoting a coordinated and well-balanced development between urban and rural areas.

            He encouraged the eastern areas of China to seize the opportunities to accelerate development and renovate and revitalize old industrial bases and the western part to implement the western China development strategy.

            He said that his government will take full advantage of the opportunities brought about by China’s accession to the WTO to open wider to the outside world.

            He pledged continued efforts to implement the sustainable development strategy and the strategy of developing the country by relying on science and education so as to achieve steady economic and social development.

            China will strive for a proper balance among development speed, dimension of reform and social bearing capacity in order to realize the perfect integration of reform, development and stability, he added.


2. U.S. Economist: China Capable of Resolving Its Financial Problems

China has favorable conditions and correct polices to resolve its major financial problems including bad loans and social security pensions, Martin Feldstein, professor of Economics in Harvard University said on March 24 in Beijing.
           
            Speaking at the China Development Forum, Feldstein said Chinese banks are essentially part of the government, and that most of their bad loans, which, in reality, constitute a fiscal problem, result from financing the investment projects, wages, and pension costs of state-owned enterprises. Therefore, given its strong economic growth, China can cope with its national debt, as long as new deficits incurred are limited or are converted into surpluses through the implementation of prudent tax, spending and banking practices.

           Feldstein said he admires China’s mixed social security pension system, saying that the system combines a taxpayer-financed basic benefit with mandatory individual investment-based accounts. This provides benefits equivalent to 60% of the net income of an average worker, and more for those with below average income.

          The system permits high levels of retirement consumption without correspondingly high taxes, he said, suggesting other countries should follow suit.

           Feldstein reiterated his admiration for the economic achievements of China over the past two decades and his optimism with regard to China’s policies for the future.

3. China’s New State Leaders Elected

          On March 15, a total of 2,951 deputies to the National People’s Congress (NPC), China’s top legislature, elected China’s new state leaders. The following are the newly elected leaders.

Chairman of the 10th NPC Standing Committee: Wu Bangguo

Vice chairpersons of the 10th NPC Standing Committee: Wang Zhaoguo, Li Tieying, Ismail Amet, He Luli (f.), Ding Shisun, Cheng Siwei, Xu Jialu, Jiang Zhenghua, Gu Xiulian (f.), Raidi, Sheng Huaren, Lu Yongxiang, Uyunqimg (f.), Han Qide, Fu Tieshan

Secretary-general of the 10th NPC Standing Committee: Sheng Huaren

President of the People’s Republic of China: Hu Jintao

Vice president of the People’s Republic of China: Zeng Qinghong

Chairman of the Central Military Commission: Jiang Zemin.

4. China’s New Cabinet Members Approved

Chinese lawmakers voted in China’s new vice premiers, state councilors and ministerial members of the State Council at the 7th plenary meeting of the First Session of the 10th National People’s Congress on March 17. The following is the outcome.
           
          Vice Premiers: Huang Ju, Wu Yi, Zeng Peiyan and Hui Liangyu

          State Councilors: Zhou Yongkang, Cao Gangchuan, Tang Jiaxuan, Hua Jianmin and Chen Zhili

Secretary-general of the State Council: Hua Jianmin

Minister of Foreign Affairs: Li Zhaoxing
Minister of National Defense: Cao Gangchuan
Minister in charge of the State Development and Reform Commission: Ma Kai
Minister of Education: Zhou Ji
Minister of Science and Technology: Xu Guanhua
Minister in charge of the Commission of Science, Technology and Industry for National Defense: Zhang Yunchuan
Minister in charge of the State Ethnic Affairs Commission: Li Dek Su (Korean)

Minister of Public Security: Zhou Yongkang

Minister of State Security: Xu Yongyue

Minister of Supervision: Li Zhilun

Minister of Civil Affairs: Li Xueju

Minister of Justice: Zhang Fusen

Minister of Finance: Jin Renqing

Minister of Personnel: Zhang Bailin

Minister of Labor and Social Security: Zheng Silin

Minister of Land and Resources: Tian Fengshan

Minister of Construction: Wang Guangtao

Minister of Railways: Liu Zhijun

Minister of Communications: Zhang Chunxian

Minister of Information Industry: Wang Xudong

Minister of Water Resources: Wang Shucheng

Minister of Agriculture: Du Qinglin

Minister of Commerce: Lu Fuyuan

Minister of Culture: Sun Jiazheng

Minister of Health: Zhang Wenkang

Minister in charge of the State Population and Family Planning Commission:
                             Zhang Weiqing

Governor of the People’s Bank of China: Zhou Xiaochuan

Auditor-General of the National Audit Office: Li Jinhua

           Wen Jiabao was elected China’s new premier on March 16, 2003.