Private economy has a 'new navigation mark' as heavyweight document boosts confidence
Published: Jul 20, 2023 10:49 PM
Photo: VCG

Photo: VCG

Chinese authorities issued guidelines on boosting the growth of the private economy on July 19th. The document was released by the Communist Party of China Central Committee and the State Council. This significant policy will inspire all private entrepreneurs and boost public confidence.

Promoting the development of the private economy requires a focus on the "peace of mind." Faced with the pressure of economic development, Chinese private enterprises are not only concerned about cutting taxes and fees but also about how to stabilize their development direction, rule of law, and fair competition predictability. Some people always criticize the problems that arise in the development of the private economy, even coming up with erroneous views such as the "retreat of the private economy." This, to some extent, interferes with the confidence of private entrepreneurs in continuing to develop their businesses. Therefore, the key to solving the problems encountered by the private economy lies in clarifying their understanding.

The guidelines start with key words like "new force" and "indispensable foundation" to give a new description of the role and status of the private economy, which further enhances and deepens the understanding of the private economy. Linking the private economy with China's modernization and high-quality development to build a modern socialist country in all respects and achieve the two-centenary goal is a high affirmation of the private economy. This refreshes the public's understanding and provides a clearer direction for the entire private economy.

Regarding the development of the private economy, the three things often mentioned in the past were marketization, rule of law and internationalization. This time, the guideline highlights the rule of law even more. The rule of law is an important prerequisite for providing long-term and stable expectations for the development of the private economy. A market economy is a rule-of-law economy, and we must not only give full play to the decisive role of the market in resource allocation but also have a more proactive government. The relationship between the visible hand and the invisible hand needs to be constructed and constrained through the rule of law. As a result, the synergy between the market and the government can be maximized, achieving an effect where 1 plus 1 is greater than 2. First, relevant regulations and policies should be evaluated and optimized as soon as possible. Second, in the process of law enforcement and judicial proceedings, both private enterprises and state-owned enterprises should be treated equally and fairly.

The release of the guideline will create a new trend for private enterprises to strive after the pandemic. However, creating a good situation ultimately depends on practical work. First, it is important to implement this document well and turn it into a long-term stabilizer. The economic sector and non-economic sectors should work together. Second, regarding the implementation of the guideline, a social assessment mechanism involving government departments, experts, scholars, and enterprises can be established. Regular meetings should be held, and the assessment results should be promptly made public to urge relevant departments to take corrective measures. Third, it is necessary to consolidate the fundamental position of fair competition policy. Past doubts and controversies should be set aside, allowing this significant document to serve as the guideline for the future. The Communist Party of China (CPC) always puts people first and promotes national rejuvenation through development, which will never change. 

Society should provide concrete support to the private economy, and private enterprises and entrepreneurs should also be courageous and take risks. Although China is currently facing severe challenges, the journey to its national rejuvenation will continue. Development will always be the top priority, and the people will always be at the center of the national strategy.