China's Leaders Talk Reform: Will They Walk the Talk?

China’s new leaders are talking nice. The country’s “ambitious” reform plans will provide “enormous” opportunities for the world, said premier Li Keqiang on May 27 at a business forum in Berlin, citing plans for industrialization and urbanization, as well as agricultural and technological upgrading. China and the U.S. must “build on past successes and open up new dimensions for the future,” stated president Xi Jinping while meeting the U.S. National Security Advisor Thomas Donilon in Beijing on the same day.

Li’s and Xi’s latest words follow a series of equally buoyant statements suggesting that the new leadership is preparing to break a logjam of reforms inherited from its predecessors. Possible initiatives include opening the economy to greater competition from private and foreign enterprises, slashing red tape, loosening government controls on where Chinese can live, and strengthening social welfare while taxing China’s most-polluting and energy-consuming industries. The reformist talk comes against a backdrop of slowing growth, with the first quarter’s 7.7 percent rise in gross domestic product even lower than the 7.8 percent rate for all of last year (which in turn, was China’s slowest growth in 13 years.)