It’s been a cracker of a year for anyone who enjoys trawling through Beijing’s official statistics and government pronouncements, comparing occasionally glaringly obvious discrepancies between figures issued by the National Bureau of Statistics and by the National Development and Reform Commission, or studying the subtleties in the wording of Party, ministerial and central bank statements.
In line with standard practice, snippets from the Central Economic Work Conference, the annual meeting of economic policy makers, were published by state media in dribs and drabs but we’ve more or less got the full picture now: Beijing will continue current "proactive fiscal policy and relatively loose monetary policy," as had basically been said by the Politburo a week ago.
Not much of this is new but, again, it is the wording of the language that is half the fun and where new patterns begin to emerge. The usual stuff about stemming overcapacity in several industries, pushing exports recovery, balancing trade et cetera was all there, but so were a couple of mentions about supporting rural demand growth (remember that one?) and urbanization – two issues which are paramount to supporting long-term, sustainable economic growth.
One standout was the statement that the government will make it easier for migrant workers to settle in the cities in which they work. This implies further relaxation of the country’s draconian hukou, or residence permit, system. While the new, as yet defined policy may not allow migrant workers to legally reside in larger cities or provincial capitals, it does mean allowing them a wider population access to health care and other social services previously unavailable to them and to their children, many of whom have been locked out of the education systems in their new homes, perpetuating the cycle of poverty.
As part of a long-term strategy of raising urban and rural incomes and supporting a wider reaching and deeper penetrating healthcare and health insurance system, some Party members in the grey windy corridors of Beijing appear to be aware that allowing the nation to live longer and work in better conditions means sustainable growth patterns.
Reform of the country’s rural health care system, raising income and consumption growth, improving education and public housing are issues that will not dissappear by throwing money at it, although a little more would help. Allowing rural or migrant workers to avail of social services by allowing official residency status will ultimately lead to a higher standard of living and improved spending patterns – and even if it doesn’t, what are the other options? These are not illegal immigrants who can be deported, but marginalized Chinese citizens who must be brought into the "harmonious society" if there is to be such a thing.
Another standout was negative; the statement said little to nothing about looming risk of inflation, indicating what some analysts say is an increasingly sharp debate over future economic policy between decision-makers in Beijing. That said, this isn’t that surprising. The Politburo didn’t say anything about inflation either. But with the sitting of the National People’s Congress in just a couple of months’ time, we should all be looking out for suggestions in Party announcements for signs of a shift in economic policy, no matter how subtle.