China May Announce Major Reforms After Third Plenary Session Next Week

On Saturday, the Third Plenary Session of the 18th Central Committee of the Communist Party of China will begin its four-day meeting.

Sounds wildly boring to be sure, but this meeting — known popularly by the snappy name “Third Plenum” — could be the biggest thing to happen to China in decades.

And given that China is now the world’s second-largest economy, that its fortunes have a major impact on U.S. corporations, and that some economists say China is on the brink of a potential economic crisis with world-shattering implications, it couldn’t hurt to take a look at what the Third Plenum is all about.

A plenum is just a meeting of China’s top Communist Party brass, and they usually hold one or two a year over the five-year term of the Central Committee, basically the party’s leadership. Most of these meetings mean very little if you’re not a member of China’s government, but the Third Plenum … that’s a different story.

Economists and news reports are quick to point out that the Third Plenum of each term — especially following a leadership change — is when all the reforms are rolled out in one gigantic flood of policy changes.

MarketWatch

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