China's pledge of big reforms cements era of market forces China's ruling Communist party pledged a "decisive" role for the market as it outlined sweeping reforms at the close of a conclave intended to map the country's direction for the next decade. In a rare policy pronouncement from China's secretive ruling elite, a communiqué at the conclusion of the four-day meeting reinforced the reformist rhetoric of President Xi Jinping signalling an eventual end to state-mandated prices in the world's second-largest economy. In a further potentially radical step, the party also pledged to address the "two-tier" system of land ownership that prevents farmers from selling their land. This has long hampered them as they try to embark with their families on lives in the burgeoning cities. "Farmers should participate equally and enjoy the fruits of modernisation," the communique said. The declarations came at the end of the third plenum of the party's 18th Central Committee, which brought together more than 370 of China's most powerful men and women. While the language of such party documents tends to be deliberately vague, leaving methods of implementation to government departments, the suggestion that the pricing of interest rates, land, energy and water would be more market-driven could have a profound effect on China's economy. "In the past they said the market played a "basic" role," said Ma Guangyuan, a Beijing-based economist. This is a big step forward. Another potentially significant clause implies that the distinction between urban and rural land that can be used for construction will be eliminated, allowing cities to expand more rapidly and potentially entitling farmers to higher compensation when land is appropriated for development. Such plenums have traditionally marked dramatic turning points in China's modern history, beginning with the Central Committee meeting in December 1978 when Deng Xiaoping reversed a decade of political anarchy and economic setbacks unleashed by the Cultural Revolution. Another plenum in 1993 set the stage for a decade of dramatic growth and reform that culminated in China's admission to the World Trade Organisation at the turn of the century. This week's plenum was billed as one that would set the direction and tone for Mr Xi's and Premier Li Keqiang's expected decade in office. Chinese officials had said the plenum would set the stage for currency and interest rate liberalisation, a loosening of restrictions on rural residents" ability to settle in cities and an assault on the power and privileges of the country's powerful state-owned enterprises. Specific details on these and other long-awaited reforms were lacking, disappointing some analysts. "I feel on the whole it was rather moderate, but the details of how it will be carried out remain to be seen," said Gao Minghua, director of a corporate governance centre at Beijing Normal University. The party also made clear the state would continue to occupy the commanding heights of the Chinese economy. The document seemed to rule out any serious effort to reduce the power of state companies in sectors such as banking, energy, telecommunications and transportation. State control of these sectors gives the government powerful levers when it needs to boost short-term economic growth, but such manipulation comes at a cost. State-owned industrial firms" return on assets has slipped to less than 5 per cent over recent years, according to GK Dragonomics, compared with a 10 per cent return on assets for their non-state competitors. Market pricing of interest rates, land and utilities would, however, chip away at some of the key competitive advantages enjoyed by state companies.