China will loosen its decades-old one-child policy by allowing two children for families with one parent who was an only child and will abolish a much-criticised labour camp system, its ruling Communist Party says.
The changes were part of a key policy document released by the official Xinhua News Agency following a four-day meeting of party leaders in Beijing. The document also seeks to map out China's economic policy for the coming years.
The labour camp - or "re-education through labour" - system was established to punish early critics of the Communist Party but now is used by local officials to deal with people challenging their authority on issues including land rights and corruption.
Pu Zhiqiang, a prominent Beijing lawyer who has represented several former labour camp detainees in seeking compensation, welcomed the abolition of the extra-legal system.
"There have been many methods used recently by this government that are against the rule of law, and do not respect human rights, or freedom of speech, but by abolishing the labour camps ... it makes it much harder for the police to put these people they clamp down on into labour camps," Mr Pu said. "This is progress," he said.
China's family-planning policy limits most urban couples to one child and allows two children for rural families if their first-born is a girl. It also allows two children for parents who themselves are both singletons.
The new policy will allow two children for families where only one parent was an only child.
The Chinese government credits the one-child policy introduced in 1980 with preventing hundreds of millions of births and helping lift countless families out of poverty. But the strict limits have led to forced abortions and sterilizations, even though such measures are illegal. Couples who flout the rules face hefty fines, seizure of their property and loss of their jobs.
Last year, a government think tank urged China's leaders to start phasing out the policy and allow two children for every family by 2015, saying the country had paid a "huge political and social cost".
The China Development Research Foundation said the policy had resulted in social conflict, high administrative costs and led indirectly to a long-term gender imbalance because of illegal abortions of female foetuses and the infanticide of baby girls by parents who cling to a traditional preference for a son.
China's leaders also pledged to open state-dominated industries wider to private competition and ease limits on foreign investment in e-commerce and other businesses in a sweeping reform plan aimed at rejuvenating a slowing economy.
The changes promised could be China's biggest economic overhaul in two decades. State media have compared the effort to market-style reforms in 1978 that launched China's economic boom.
Chinese leaders are under pressure to replace a growth model based on exports and investment that delivered three decades of rapid growth but has run out of steam. Reform advocates say Beijing must curb the privileges and dominant role of state companies they say are inefficient and a drag on growth.
In Friday's report, the ruling party pledged to ease barriers to private competitors in markets controlled by state companies, though they reaffirmed that government-owned industry is the core of the economy.
"We must promote orderly opening to the outside," the report said.
It left out many details of what role private or foreign competitors might be allowed in government-controlled industries such as energy, telecoms and finance. But it outlined changes clearly intended to make industries more efficient and productive by injecting more competition.
It promised measures such as allowing the creation of privately owned banks and use of market forces to allocate resources. Both would help dynamic private companies that create most of China's jobs and wealth but struggle to get financing.
As for foreign companies, the report pledges to ease limits on foreign investment in e-commerce and other industries.