A chip manufacture machine File photo: VCG

China on Tuesday unveiled a sweeping reform plan for a slew of state institutions, with a focus on restructuring the Ministry of Science and Technology (MST) and establishing a national financial regulatory administration, underscoring the country's intensifying efforts to bolster its scientific-technology capabilities and economic and financial security amid growing external uncertainties. 

The institutional reform plan, which also covers areas ranging from data administration and elder-care work to intellectual property rights and agricultural and rural sectors, are in line with the top leadership's goal of improving governance efficiency to tackle risks and challenges and pursue high-quality development, experts noted. 

The plan was submitted on Tuesday to the National People's Congress (NPC), China's top legislature, for deliberation. The plan is part of important arrangements made at the 20th National Congress of the Communist Party of China (CPC) for deepening reform of Party and state institutions, and was adopted at the second plenary session of the 20th CPC Central Committee last week. When implemented it will mark the most sweeping reform plan of state institutions since 2018.

Improving efficiency

One of the main parts of the plan unveiled on Tuesday is the restructuring of the MST. With the transferring of functions such as technology policymaking for the agricultural sector to other ministries, the MST will be tasked primarily with a bigger role in improving a new system for mobilizing the nation to make technological breakthroughs.

Very significantly, a central science and technology commission will be established to beef up the CPC Central Committee's centralized and unified leadership over science and technology-related work.

Explaining the plan to national lawmakers, State Councilor and Secretary-General of the State Council Xiao Jie said the MST will be restructured to better allocate resources to overcome challenges in key and core technologies, and move faster toward greater self-reliance in science and technology, according to Xinhua.

The US has been relentlessly stepping up its containment of China's development, especially through cutting supply of core technological components to China. Just in the past few days, the US has taken or is mulling ever more crackdown measures against Chinese firms, including an export ban on dozens of Chinese entities.

Amid such containment and hostile policies, China needs to mobilize all resources to build up its own capabilities and effectively optimize its governance system so as to better cope with external challenges, Zhang Shuhua, director of the institute of political sciences at the Chinese Academy of Social Sciences, told the Global Times on Tuesday.

Describing the reforms as "problem-oriented," Zhang noted that the reforms help strengthen the Party's overall leadership in the nation's socialist modernization, will make intuitional structure more scientific, and will improve efficiency of operations and management. 

Tech firms hailed the reform plan for the MST as a great step to allow the ministry to focus on technological breakthroughs. 

As many functions of the MST that are unrelated to technology itself have been transferred, it can "concentrate more on coordinating resources to tackle certain advanced, special technologies," a representative from one of China's leading tech firms told the Global Times on Tuesday. 

Dong Shaopeng, a senior research fellow at the Chongyang Institute for Financial Studies at the Renmin University of China, said that reform of the MST is conducive to improving the whole-nation system, promoting scientific and technological innovation, and will break through the "bottleneck" technologies.

Tackling risks

In another crucial bid to improve regulatory capability and efficiency to tackle financial risks, the reform plan includes broad reforms to its financial regulatory mechanism both at the national and local levels. 

China will set up a national financial regulatory administration. Directly under the State Council, the proposed administration will be in charge of regulating the financial industry except the securities sector. It will be established on the basis of the China Banking and Insurance Regulatory Commission, which will not be retained and certain functions of them will be transferred to the new administration, according to Xinhua. 

"This round of institutional reform highlights the country's emphasis on risk prevention," Cong Yi, a professor at the Tianjin University of Finance and Economics, told the Global Times on Tuesday, noting that the rapid development of the Chinese financial market, especially in the online finance sector, requires an upgraded regulatory system and mechanism.  

Apart from the fast growth of the Chinese capital market, a rapidly shifting global geo-economic situation demands increased capabilities to prevent and defuse risks to ensure economic and financial security, experts noted. Effectively preventing and defusing major risks is among the top priorities for 2023, according to the Government Work Report. 

The reform plan is in line with ongoing market reforms, which aim to close regulatory gaps in certain areas such as debt issues in the real estate sector and cope with new risks as financial opening continues to expand, according to Tian Yun, a veteran macroeconomic observer.

"Strengthening financial supervision and preventing financial risks is an inevitable requirement of current economic development," Tian told the Global Times on Tuesday.

A concept photo of digital city Illustration: VCG

Aiming to improve regulations in another crucial sector, the reform plan on Tuesday includes to establish a national data bureau.

The proposed bureau, to be administered by the National Development and Reform Commission (NDRC), will be responsible for advancing the development of data-related fundamental institutions, coordinating the integration, sharing, development and application of data resources, and pushing forward the planning and building of a Digital China, the digital economy and a digital society, among others, according to Xinhua. 

Data has become another crucial area related to almost every aspect of China's economic and social development, as well as an area where international competition is heating up, experts noted. 

"Data has increasingly become an important asset and a bargaining chip in the competition between major powers. In this case, China carried out institutional reforms to strengthen the management of data," Tian said, noting that the new bureau could play an important role in such competition. 

Overall, the reform plan is a broader effort by China's top leadership to tackle both short-term and long-term challenges facing the Chinese economy, including demographic changes. 

The reform plan includes improvements to the elderly-care work mechanism to implement the proactive national strategy in response to population aging and to expand the basic elderly-care services to cover all senior citizens, according to Xinhua. China will also improve the management mechanism for intellectual property rights (IPR) to upgrade IPR creation, application, protection and management.