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By Wang Yiming, DRC

2018-11-13

General Secretary Xi Jinping pointed out at the symposium on private enterprises’ development that private economy is an important outcome of the development of the socialist market economy and also a major force to promote the development of the socialist market economy. It is an important entity in fueling the supply-side structural reform, pressing ahead high-quality development and building a modernized economic system. It is also an important force for enhancing the Party’s leadership in leading the Chinese people to realize the Two Centenary Goals and the Chinese Dream of the great rejuvenation of the Chinese nation. Since the reform and opening up, private enterprises have witnessed a flourished development. The private economy has growth from small to big and from weak to strong, playing an important role in stabilizing economic growth, facilitating innovation drive, increasing employment opportunities and improving people’s livelihood, and making indelible contributions to China’s economic development. China’s private economy cannot be weakened but be strengthened in wider areas and at higher levels.

Firstly, we must firmly adhere to the principle that there will be no irresolution about consolidating and developing the public sector and no irresolution about encouraging, supporting and guiding non-public sector development. China implements the basic economic system in which the public ownership is dominant and different economic sectors develop side by side. In the new era, we must create a favorable legal and business environment for the development of private enterprises, protect their legal rights and interests, and encourage, support and guide the private economy to enhance its development. All forms of unreasonable stipulations need to be abolished, various practices of discriminating against private enterprises need to be eliminated, and all explicit and implicit barriers need to be removed. We need to effectively address the problems facing private enterprises in their development, such as inadequate protection of their rights and interests, obstacles relating to market access, and difficulties in and high cost of financing, so as to fully unleash the vitality and creativity of private enterprises.

Secondly, the property rights protection system needs to be further improved. The property rights system is the bedrock of socialist market economy. To promote the healthy development of private economy, we must improve the modern property rights system with clear ownership, clear-cut rights and responsibilities, strict protection and smooth flow. We need to establish and improve the system for protecting property rights with fairness at its core, improve the legal system for equal protection of property rights, and lose no time to correct a number of misjudged cases and injustices that infringe upon the property rights of enterprises.

Thirdly, market access for private enterprises needs to be further relaxed. We need to effectively break all kinds of administrative monopoly, prevent market monopoly, create a fair market environment for competition, and ensure that private enterprises could enjoy equal rights, equal opportunities and equal rules. The implementation of a new negative list of market access needs to be sped up and the setting of thresholds for investment access needs to be standardized. No additional conditions could be imposed on private investment access.

Fourthly, more efforts need to be made to ease the difficulties and high cost of financing for private enterprises. We need to standardize and innovate ways of providing financial services and improve the capacity and level of providing financial service to private enterprises. In view of the current difficulties in financing for private enterprises, the market-based way should be used through bonds financing. We need to enforce the supervision over the credit practices of commercial banks, and clean up and regulate the banks’default collection of loans, pressure on loans and false promises.

Fifthly, a close, clear and new relationship between the government and business needs to be established. We need to strengthen the rule of law, create a favorable environment for the government and enterprises to interact with each other, and smooth the way for normal interactions between the government and businesses. We need to improve the participation of private enterprises in public affairs and ensure that new officials must not be allowed to disavow obligations undertaken by their predecessors. A sound legal, market and social environment should be fostered to guide entrepreneurs to be patriotic, devoted, law-abiding and innovative and encourage them to make more contributions to the society.