China’s Premier Admits Errors, Vows Austerity

From Reuters

Premier Li Peng opened the annual session of congress today, admitting mistakes in China’s reform program and promising several years of austerity to correct them.

But his unusually frank remarks went unheard by the architect of the 10-year-old reforms, 84-year-old senior leader Deng Xiaoping, who did not attend the meeting.

“We . . . had shortcomings and mistakes in our guidance,” Li said. “Generally there was a tendency to be too impatient for quick results in economic and social development.”

Li spoke to nearly 3,000 delegates to the National People’s Congress in the cavernous Great Hall of the People in the heart of Beijing.


Western diplomats said they were surprised at the absence of Deng, who was last seen in public Friday apparently in good health when he met visiting Thai Prime Minister Chatchai Choonhawan.

Zhao’s Economic Role

Deng’s right-hand man, Communist Party chief Zhao Ziyang, sat on the podium, occasionally marking his copy of the premier’s speech.

Zhao has come under criticism for his handling of the economy, taking the blame for bank runs, panic buying and the worst inflation since the Communists seized power in 1949.


An austerity program was imposed last September to cut government spending and cool the overheated economy, but inflation still reached 18.5% and soared to more than 30% in cities.

Li said that the austerity policy, which he has spearheaded, was correct but that results so far fell “far short of the goal of improvement and rectification.”

‘Few Years of Austerity’

“Both government and people should be mentally prepared for a few years of austerity,” he said.

The 60-year-old leader, a Soviet-trained technocrat, promised tougher controls on prices and tighter credit to halt official overspending.

Li did not mention human rights in his speech despite calls by a number of intellectuals for an amnesty for political prisoners.

Li called for a continued opening to the West, a key part of the reform program, underscoring the need for foreign capital and technology and praising an improvement in Sino-U.S. economic and trade ties.