1. Challenges for China’s economic reform: from the perspective of a holistic approach Pingfan Hong 3 rd Annual NYU Conference on Chinese Capital Markets December 6, 2013 Views expressed here are those of the speaker and they do not represent the views of the UN

2.  Clearly defined goals, strategies and measures  Consistency in reforming different markets and economic sectors  Coherence in reforming different institutions  Compatibility to global trends and the role of China in the world A holistic approach to China’s economic reform should ensure: 2

3.  A world of rapid and constant changes  Two different types of institutional changes: Revolution versus reform  Almost every country undertakes economic reforms: U.S.: Dodd-Frank Act, Obama Care Euro area: Bank Union North Korea and Cuba: Special Economic Zones  International implications of China’s reform: In response to international competition (TPP,TTIP) Reinforce and reshape the global wave of reforms China’s reform in a global perspective 3

4.  General goal: improving and developing China’s socialist system Some specific goals: market plays decisive role in resources allocation transform the function of the government  Strategies: Top design and “crossing the river by groping the stone under foot” Some measures: Mixed ownership through cross share-holding “Negative–List ” approach to regulation on market entry Goals, strategies and measures for China’s economic reform as set in recent CPC reform roadmap 4

5.  Importance of reform sequencing: Liberalizing interest rates Floating the exchange rate of reminbi Opening capital and financial accounts  Integrated reforms in different sectors: liberalizing interest rates Reform of banks Reform of State Owned Enterprises Ensuring consistency in reforming different sectors 5

6.  Economic reform: Economic freedom, efficiency  Social reform: Equity, equality (in rights, opportunity and rules)  Political reform: Participatory and democratic governance The rule of law  Ecological reform: Environmental sustainability  Cultural reform: Values Ensuring coherence among reforms of different institutions 6

7. Thank you !