Out with red tape as business reforms bite
China is expected to further improve the business climate, unleashing more market vitality and adding resilience to the economy, and thereby propelling highquality development, analysts and business leaders say.
The country will further deepen reforms to streamline administration and delegate power, improve regulation and upgrade services to create a market-oriented, law-based and internationalized business environment, they said.
“A sound business environment with a level playing field enables market entities to trust each other and leverage their respective advantages to effectively allocate resources and make the most of production factors,” said Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation.
“As companies currently face more uncertainties amid the impact of the pandemic, it is especially important to establish a market environment that facilitates collaboration rather than encourages distrust.”
At a news conference after the fifth session of the 13th National People’s Congress, which concluded on March 11 in Beijing, Premier Li Keqiang said that when there are good reform measures, a sound business climate and many market entities, as there are in many places in China, the prospects for economic development are greater.
Reforming government functions is like improving the soil for the growth of market entities, policies of tax reductions are like adding fertilizers and water, and the initiative of mass entrepreneurship and innovation helps market entities take root and grow, he said.
According to Zhou, China should intensify reform efforts to provide a more predictable business environment with transparent and accurate information so companies can make well-informed and more productive decisions.
That will eventually help reduce company costs and improve market resources allocation and utilization, to enhance the quality of overall economic development, he said.
To raise the efficiency of the Chinese economy, the government should do more to encourage innovation so more advanced technologies are better applied in businesses’ production and operations, he said, and that innovative business models and formats will take form and grow.
Zheng Lei, vice-president of the Hong Kong International New Economics Research Institute, said that to improve the business environment it is important for the government to streamline administration and delegate power, and, most importantly, to adopt a mindset of “serving and regulating” companies rather than “managing” them.
Hiroshi Hamaguchi, chairman and president of Astellas China, said he thinks China will continue to introduce new measures that ensure a more transparent and favorable market environment for foreign companies.
In November, Astellas invested in a corporate structure upgrade in China to synergize its long-term development in the country.
Rogier Janssens, managing director and general manager of Merck China Healthcare, said he looks forward to China adopting more measures to facilitate an even more favorable and open business environment. Merck plans to continue to invest in China, he said.
Li said at the news conference that there are now 150 million market entities in China, 100 million more than 10 years ago. Most are privately held firms and about 100 million are self-employed households.
China has either canceled or delegated to lower-level authorities about 1,000 administrative approval items, and the non-administrative approval requirement has become a thing of the past.
In the past it took up to 100 days to open a business in China, but it now takes four days, on average, and even just one day in some places. About 90% of government services can be accessed online or through mobile phone apps.
“A sound business environment with a level playing field enables market entities to trust each other and leverage their respective advantages to effectively allocate resources ...”