The Chinese People's Political Consultative Conference and the National People's Congress are holding their annual sessions against the backdrop of a once-in-a-decade leadership transition. The new leaders face high expectations. Addressing the country's glaring income disparities tops the wishlist of many Chinese. The recent release of the guidelines to reform income distribution is a welcome measure. The international community, again, is looking to the new leadership for comprehensive economic reforms that will ensure sustainable growth and help stabilize the global economy.

The open style adopted by the new leaders signals their willingness to reform. They have indicated their intention to focus on the quality, efficiency and sustainability of growth. This will help rebalance the economy and reduce the gap between the rich and the poor. The leaders have also identified reform priorities. Interest rate liberalization, fiscal reform and greater private sector participation are high on the agenda.

So far the leadership has focused on economic restructuring. Several further challenges need to be addressed. Chief among them is the socio-economic impact of a rapidly aging population.