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China’s private sector
EconomyPolicy

China has policy window for more private sector support, official says

Even after passage of Private Economy Promotion Law, economic planner says ‘gaps remain’ in shoring up enterprise and investor confidence

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China’s private firms could still receive more policy support, an official with the country’s top economic planner said. Photo: Xinhua
Carol Yangin Beijing

China’s top economic planner acknowledged on Tuesday there is still room to improve the country’s business environment, a sign Beijing may roll out stronger support for the private sector even after this year’s passage of a law ensuring equal legal treatment and other protections for non-state firms.

“Despite notable progress in recent years, gaps remain in meeting the demands of the private sector and private enterprises’ expectations,” wrote Wu Xiaoyan, director general of the National Development and Reform Commission’s (NDRC) Centre for the Promotion of the Business Environment.

Wu’s article was published in the People’s Daily, the official newspaper of the ruling Communist Party.

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In the piece, Wu called for strengthening the protection of property rights, regulating law enforcement as it relates to enterprises, developing diversified dispute resolution mechanisms and improving government services and conduct.

Those issues have been mentioned frequently by the country’s entrepreneurs as areas of concern in recent years, particularly in the realm of law enforcement. On that front, Wu emphasised the necessity of curbing the abuse of administrative discretion, preventing profit-driven fines and ending unauthorised cross-regional enforcement.
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Beijing now has an opportunity to stabilise market sentiment and revitalise investor confidence, Wu added.

China’s private sector accounts for over 60 per cent of gross domestic product and more than 80 per cent of urban employment. However, business owners have long complained about limited market access, preferential treatment for state firms in obtaining financing and the seemingly arbitrary application of fines and other punitive measures by local law enforcement.
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