CHINESE REFORM FROZEN TILL FALL?

Progress on political and economic reforms in China is likely to be frozen until the Communist Party congress this fall.

The forced resignation of party leader Hu Yaobang Jan. 16 in the wake of student demonstrations for democracy has not resolved the ideological and personal power struggle at the top of the party, according to Chinese sources.The party congress in October is likely to thrash out a new program of political and economic reforms. Some Chinese also expect a major reshuffle of the party and government leadership.

The party may well decide to delay firm decisions on the post of premier and general secretary until then. Zhao Ziyang, a firm supporter of economic reform, now is both prime minister and acting general-secretary of the party.

The chances that a new prime minister will be announced before then has receded because a struggle between the "reformers" and "conservative s" is still in progress.

In a speech last week, Mr. Zhao attempted to reassure the world that China is not beginning a destructive political campaign against "bourgeois liberalization."

However, the Chinese press still is full of tirades against those who breach party discipline and who favor all-out westernization. The views of conservatives have been given full rein, not just on ideological issues but also on economic matters.

Mr. Zhao, who apparently is trying to restrain the onslaught of the conservatives, emphasized that China remains committed to economic and political reform.

But the usual assumptions about paramount leader Deng Xiaoping's open- mindedness and desire for rapid modernization have been shattered by his abandonment of Mr. Hu, his close associate for 40 years. And it no longer is clear how far Mr. Deng's authority extends.

In this atmosphere of uncertainty, few senior officials within the government will risk initiating further reforms. The first victim was price reform. Price controls on a number of food items and consumer durables were to be lifted at the beginning of this year.

However, at a meeting after the first student demonstrations last December it was decided to postpone making difficult decisions.

Western analysts are reluctant to believe the Chinese government's commitment to foreign investment is in doubt. Foreign trade may eventually be affected. Imports of goods for projects of dubious industrial value such as tourist-related hotel projects may be shelved.

There are doubts too whether military-sensitive high technology exports will be authorized until China's political leanings become clearer. Progress in a few areas of financial reform is likely to continue, Chinese sources believe. But reforms are likely to be postponed if they pose direct political implications for the role of the party.

The contract system for new entrants into state-run factories is one such area. The appointment of outside directors to manage ailing state-owned factories on a contract basis will be another.

Other reforms that will be watched closely are the controversial bankruptcy law and measures to grant factory managers greater autonomy or decentralize decision-making to provincial authorities.

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