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Commentary: New journey begins for China's private sector

Source: Xinhua| 2018-11-03 18:47:01|Editor: Lu Hui
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BEIJING, Nov. 3 (Xinhua) -- With unswerving support from the central authorities, China's private enterprises are set to embark on a new journey and embrace a brighter future.

On Thursday, President Xi Jinping presided over a symposium on private enterprises, saying that China will unswervingly encourage, support and guide the development of the non-public sector and support private enterprises to move toward a broader stage.

The private sector plays an important role in the Chinese economy, contributing more than 50 percent of tax revenue, 60 percent of GDP, 70 percent of technological innovation, 80 percent of urban employment and 90 percent of new jobs and new firms.

Xi reiterated the status and functions of private enterprises, adding that the sector has played an important role in developing the socialist market economy, transforming government functions, transferring surplus rural labor and tapping the international market.

"Over the past 40 years, the private sector of the economy has become an indispensable force behind China's development," Xi said.

However, some private companies have recently encountered difficulties and problems in their development in terms of market, financing and transformation.

The principle and policies to unswervingly encourage, support and guide the development of the non-public sector have not changed, and the principle and policies to provide a sound environment and more opportunities in the sector have not changed either.

Xi demanded the implementation of policies and measures in six aspects to create a better environment for the development of private enterprises and to address their difficulties, including reducing their burden of taxes and fees, addressing the difficulty and high cost of financing, and leveling the playing field for them.

Policy support has already been stepped up. Late last month, the government decided to facilitate bond issuance by private companies, with liquidity support from the central bank lent to professional institutions.

The People's Bank of China, the country's central bank, announced that it will provide guidance for supporting bond issues of private firms by offering a part of the initial capital to financial institutions, and also increase the quotas of re-lending and rediscounts to ensure that targeted loans can be channeled to private firms.

With the new commitments to supporting the private sector, more favorable policies are expected be rolled out soon.

The difficulties and problems faced by private enterprises are just a natural part of development, and will surely be solved with effective measures.

As private companies and entrepreneurs are once again reassured by central authorities, their potential is to be further unleashed while China's economic strength is to be further improved.

Economic Watch: Entrepreneurs reassured after Xi vows unwavering support

KEY WORDS: private sector
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