Opinion: Bureaucratic restructuring - power is the key

In March, the State Council announced a restructuring of the national-level bureaucracy. The number of ministries was reduced from 27 to 25 and the functions of several agencies were consolidated into a single office. The stated purpose of this reform was to increase government efficiency and to reduce government interference in the market. The facts are quite different. First, the restructuring has little to do with improvement in government structure. The primary motivation is the allocation of power. The restructuring will result in administrative chaos and uncertainty, leading to greater inefficiency. The new, more powerful agencies will interfere more in the market, not less. As is typical in the upside down world of Chinese politics, what we get will be the opposite of what we are told is happening.

From commercial to state-owned

Take the case of the Railway Ministry. The Railway Ministry has been the target of the central government for a number of years. It is therefore no surprise that the Ministry was dissolved during the restructuring. The Ministry was split into two parts, with its regulatory functions allocated to the Ministry of Transport and its commercial railway operation functions allocated to an entirely new company, the China Railway Corporation.