Demonstrative economic change required

Chinese Premier Li Keqiang addresses the opening ceremony of the Annual Meeting of the New Champions 2013, also known as Summer Davos, in Dalian, Northeast China's Liaoning Province, September 11, 2013. The three-day Summer Davos opened in Dalian on Wednesday. (Xinhua/Pang Xinglei)

At the opening ceremony of the Summer Davos Forum on Wednesday, Chinese Premier Li Keqiang said the new season of Chinese economic miracle, one of better quality and higher efficiency has been unveiled. He stressed the importance of economic transformation and called for innovation, and promised to carry forward the reform to the end.

Transformation, restructuring and innovation - these have gradually become high-frequency words in the reports of China's top leadership, which means they have made steadfast determination to let the reform carry on. However, so far, local governments have not been on the track to fulfill these established goals. It is believed that local governments have been "kidnapped" by the vested interests acquired through the out-dated development model, and innovation is risky.

To some extent, this is true. Local governments are more dependent on simple routes to make revenue, such as selling land. What's more, deep reform, which will inevitably tackle vested interests, imposes greater risks on the promotion of local officials.

China has already established a pattern of infrastructure construction to boost its social and economic development. Using a government-led model, China has speeded up its development.

However, rapid development is pushing the Chinese economy to over-heat. Wasted resources, environmental destruction and property bubbles corrode China's economic achievements. These problems are also sounding alarms to government officials. But besides the need to safeguard their vested interests, officials are facing a huge barrier: They don't know what to do.

So far, there are no existing successful examples of economic restructuring. The long-practiced extensive economy has already combined the benefits of both the local governments and the local people, making them reluctant to "start a new undertaking."

It should be noted that this extensive economic model has created many employment opportunities, promoted consumption and produced large revenues. But besides some theoretical assumptions, China has not explored more practical patterns to replace it.

Now China is in need of some pioneers to make breakthroughs, like the ones who opened China's reform and opening-up 35 years ago. Like sparks of fire, China needs a handful of enterprising officials in local governments to break the deadlock. Their breakthroughs will prove that restructuring is feasible and the reform will produce more profits than before.

This will be tough exploration. China is doing it before crisis happens. It could be held back by the difficulties.

Fully releasing the energy of the market is the key to the success of reform. It is necessary to reinvigorate the innovation of enterprises, which have been too reliant on the government.

At the start of China's reform and opening-up, special economic zones demonstrated the change. It might be unfeasible to set up a few similar zones officially to research economic transformation, but it is important for the government to hold this thought and allow certain places to make this undertaking possible. Wisdom and encouragement will bring restructuring breakthroughs.