Economist urges further reforms in property rights

The reform of China's property rights system has not yet been completed, a renowned economist said on Thursday.

China has to push forward reform to cultivate the "real" players in the market, Li Yining, a Peking University professor said.

"China's property rights reform is not yet finished. Unless we solve the issues of rural land property rights and State-owned enterprises' property rights, China can hardly become a real market economy," said the 83-year-old, who was deeply engaged in the country's early era of reform and opening-up.

He made the remarks at the launch ceremony for the English-language version of his latest book, Chinese Economy in Disequalibrium.

In the book, Li discusses the concept of "dual transition", meaning that reform and opening-up are not only about transition from an agricultural society to an industrial society, but also about the transition from a command economy to a market economy.

The dual transition has to overcome enormous challenges, among which are an "underdeveloped" market and a lack of "real market players", he said.

In his view, ambiguity in property rights is a major reason for the lack of market players. The problem is particularly acute with the SOEs. Though SOEs have undergone many reforms in the past two decades, the process of reform is not yet completed, he said.

"So when the Third Plenum called for a hybrid- owned economy, it really is a big deal. This means that the SOEs should open the door for private capital and allow them to buy their shares," he said.

"Employees in SOEs should also be allowed to hold their companies' shares and private investors should be allowed to take over poorly performing SOEs," he said.