Legal Reform in the Quest for a Socialist Market Economy

Abstract

The conclusion of the discussion of the 1989 Democratic Movement at the ninth plenary session of the Thirteenth Chinese Communist Party (CCP) Central Committee, on 9 October 1992, cleared the way for Deng Xiaoping to realign the Party on the basis of a liberal economic reform which he had publicized widely since returning from South China in February 1992. The Fourteenth Party Congress in October 1992 saw the revival of his ‘cat theory’ — to develop productive capacity by introducing a socialist market economy into the socialist system — and gave him a mandate to accomplish this task.1 This progressive idea of economic reform, which holds public ownership and a market economy as compatible in the socialist planned commodity economy, appeals to creative thinking in the search for working principles.2 Thus an atmosphere of ideological relaxation in the economic realm was brought about. Deng’s political thought was later internalized in the Party Constitution, which led to the amendment of the Constitution of the PRC to legitimize a market economy in socialist China.3 Following the exodus of conservative figures, the economic reformers have gradually regained dominance in Chinese politics since the Eighth National People’s Congress (NPC) in March 1993. With reform inspirations from the CCP’s Politburo members such as Zhu Rongji, Qian Qichen, Li Lanqing, Li Ruihuan and later Wu Bangguo and Jiang Chunyun,4 the reform momentum was further consolidated.