Our Understanding of Several Problems Concerning the Successful Reform of the State-Owned Economy (May 31, 1996)

The Fourth Session of the Eighth National People's Congress has passed the "Ninth Five-Year Plan For the National Economy and Social Development and An Outline Program of Long-Range Goals For the Year 2010." This "Outline Program" brought up the proposal that, by the end of this century, we must comprehensively fulfill our second-step goals in the construction of modernization: Keep the population under 1.3 billion by the year 2000; achieve a quadrupling of 1980 per capita gross national product; basically eliminate poverty and achieve a moderate standard of prosperity in the lives of the people; speed up the construction of a modern entrepreneurial system and thus gradually establish a socialist market economic system. At this time, the people throughout the nation are fighting heroically and with great confidence for the accomplishment of this goal. The "Outline Program" pointed out that the key to the achieving of this monumental goal lies in bringing about two strategic transformations that will affect the total picture. The first is that the economic system itself must be transformed from a traditional planned economic system into a socialist market economic system. The second is that the mode of the growth of the economy must be transformed from an extensive to an intensive mode. In order to bring about these two fundamental transformations, we need to pay attention to two strategic foci: The first is in agriculture and the second is in the state-owned economy. Today, I would like to focus on analyzing the reform of the state-owned economy.