Aid to private businesses pledged
Support signaled in meeting with entrepreneurs
President Xi Jinping sent a strong signal of maintaining supportive policies toward private businesses, including such measures as tax reductions, at an unusual meeting with entrepreneurs on Thursday.
Xi, also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission, was briefed by 10 entrepreneurs, mostly from small and medium-sized companies, at the Great Hall of the People. He talked with them about their difficulties and required that related government departments study how to address the problems properly.
After the briefing, Xi delivered a speech pledging to support the development of private businesses as always.
Private businesses’ status and role in China’s economic and social development are unchanged; the Party’s policies of unswervingly encouraging, supporting and guiding the development of private businesses are unchanged; and the Party’s dedication to improving the environment and providing more opportunities for private businesses is unchanged, Xi said.
China’s private businesses can only become stronger in the process of building a moderately prosperous society in all respects, he said, and they should play on a broader stage.
Since the reform and opening-up policy was introduced 40 years ago, private businesses have become an important force in promoting the country’s development, Xi said, adding that private companies have contributed to entrepreneurship, employment, innovation and revenue.
The Party’s stance is clear and consistent on upholding its basic economic system, which has already been enshrined in the country’s Constitution and the Party’s Constitution, Xi said.
He added that the strengthening of the public sector does not contradict support for the private sector.
All private companies and private businesspeople should focus on the development of their businesses without doubts or anxiety, Xi said.
Xi said the problems of some private firms in such areas as market, finance and transition are caused by multiple factors, and these problems will be resolved in the process of their development.
It’s natural that China, which is in the process of development, comes across problems such as rising uncertainties in economic development, increasing pressure from economic slowdowns and more difficulties for businesses, he said, adding that China has great potential from its huge market and the rising middle class.
Xi introduced six measures, including easing companies’ tax burdens, resolving private companies’ difficulties in borrowing money, building a fairer environment for competition and protecting the safety of private businesspeople and their wealth.
The president’s commitment to supporting private businesses is in line with his remarks during his recent inspection tours in Liaoning and Guangdong provinces, where he visited private companies and reaffirmed the Party’s unswerving support for private businesses.
Lu Weiding, board chairman of Wanxiang Group, an auto components manufacturer based in Hangzhou, Zhejiang province, said after the meeting that he was greatly encouraged by Xi’s commitment to supporting private businesses.
“General Secretary Xi talked with us face-to-face, and we are assured that the Party’s supportive policies for private businesses and entrepreneurs have never changed in the 40 years since the reform and opening-up began,” he said.
Lu said China has comprehensive industrial chains and an excellent workforce with a good educational background. He said he is quite confident about the future of his business.
Yi Huiman, chairman of the Industrial and Commercial Bank of China, said the president’s remarks put private entrepreneurs’ minds at ease.
ICBC will make further efforts to implement Xi’s requirements on supporting private businesses and provide better financial services to private companies, he said.
Some recent irresponsible comments suggesting it is time for the nonpublic sector to be incorporated into the public economy have understandably spooked private entrepreneurs.
But there is no reason for them to be concerned, as the top leadership has made clear that the country will continue to support the nonpublic economy. There is no doubt that private enterprises have been feeling the pain due to the country’s ongoing economic restructuring and the US onslaught on the Chinese economy. But speaking at a meeting with private entrepreneurs on Thursday, Xi Jinping, general secretary of the Communist Party of China Central Committee, pledged that the country will help the private economy with tax cuts and financing facilitation policies. And he reiterated that the property of private entrepreneurs will be protected.
Private enterprises — which are active in most of the country’s economic sectors, and account for the bulk of the country’s growth, taxation and employment — have played an indispensable role in China’s development, he said.
This was consistent with Xi’s remarks in the report he delivered to the 19th National Congress of the CPC in October last year, when he said that the government should promote the healthy growth of the nonpublic sector of the economy, and encourage those working in this sector to achieve success.
Likewise, China’s Constitution stipulates that the nonpublic sectors of the economy such as the individual and private sectors are an “important component” of the country’s overall economic system, and the State has the duty to protect the lawful rights and interests of individuals and private enterprises.
This was affirmed by the Political Bureau of the CPC Central Committee at its meeting on Wednesday to analyze the economic situation, when it said that the development of enterprises of all types of ownership will be resolutely supported, and it is looking at ways to help private enterprises tackle the challenges they are facing.
It is not the first time that the Chinese economy and its private enterprises have faced harsh challenges in the reform and opening-up era. But each time the difficulties have been overcome. There is no reason to think that will not be the case this time despite the concatenation of circumstances.
The indexes show China’s economic fundamentals remain sound, and the Chinese economy remains one of the most dynamic.
But to give a shot in the arm to the nonpublic sectors and bolster the confidence of entrepreneurs, the authorities should accelerate the supportive measures pledged by Xi and continue to be proactive in improving the business environment for private enterprises.