China has slashed almost half of its administrative restrictions faced by entrepreneurs in establishing and operating businesses in an attempt to fight corruption and improve efficiency.

The State Council's administrative examination and approval system reform office said yesterday that since 2002, the 68 State Council commissions and ministries had rescinded or amended 1,806 of 3,605 administrative approval items.

Provincial-level governments had also cancelled more than half of their items, the office said, citing Zhejiang government, which slashed the number of approval items from 3,251 to 630 in five years.

The power of approval has also been shifted to industrial associations and other intermediary agencies, the office said.

Administrative approval, which refers to the granting of legal permission for individuals and corporations to engage in special activities, mostly business-related, is a major function exercised by government bureaus at all levels.

Intensified under the planned economy, the system centralizes power in the hands of the government.

Over the years, hazardous expansion of approval items, over-elaborate procedures, poor efficiency, and under-the-table deals have seriously infringed the rights of individuals and corporations and hampered China's efforts to build a market economy.

The State Council began a nationwide campaign to rectify the situation in 2001.

While the government has been slashing the number of approval items, experts question whether further progress can be made.

According to Wang Yukai, an expert with the Peking University, after 20 years of moderately cutting some items of petty interest, the reform has come to a delicate point - tackling institutionalized interest and the power of some government bureaus.

"It has come to a bottleneck. Administrative reform cannot be deepened without progress in the reform of the political system," Wang said.

Experts consider reform of the administrative approval system a key part in the country's slow reform of its political system.

The final goal of the administrative approval reform is to readjust the relationship between the government and market, to let the market play the lead role in relocating resources, and to create a government with less interference, said Zhou Hanhua, expert with the China Academy of Social Sciences.

"It could be a breakthrough for the country's political system reform, as it paves the way for a transparent and efficient government ruled by law, which is a core goal of the political reform," Zhou said.

(China Daily 06/20/2007 page3)