Platform economy seen as reliable growth driver
China’s greater emphasis on bolstering healthy growth of the platform economy will further spur innovation and vitality among platform-based enterprises, better stabilize investor confidence and foster high-quality development, said industry experts.
Regulations covering the platform economy are expected to be enforced in a standard, transparent and predictable manner and follow the principle of the rule of law and market orientation, they said.
Their comments came after a meeting of the Political Bureau of the Communist Party of China Central Committee on April 29 called for efforts to promote the regulated and healthy development of the platform economy.
Rectifications of the platform economy will be completed, regular supervision will be initiated and specific measures to support its standardized and sound growth will be rolled out, it was decided at the meeting.
The China Banking and Insurance Regulatory Commission underscored that it will complete rectification of large platform companies, set up both “red lights” and ”green lights”, and implement regular oversight so as to boost the healthy growth of the platform economy.
The People’s Bank of China, the country’s central bank, also said in a statement on Wednesday that it will improve its capital governance capacity and conduct regular supervision of platform enterprises’ financial activities.
“The latest moves indicate the most recent rectifications of the nation’s platform economy have almost come to an end, while more concrete actions will be taken to achieve regular supervision over platform-based enterprises in the future,” said Pan Helin, co-director of the Digital Economy and Financial Innovation Research Center at Zhejiang University’s International Business School.
Noting the platform economy is playing an increasingly crucial role in driving China’s economic development amid the COVID-19 pandemic and complex external environment, Pan said more efforts are needed to give full play to the advantages of the platform economy, which is of vital significance in improving people’s livelihoods and expanding employment.
Pan said authorities should bolster development of the platform economy to improve the efficiency of resource allocation as well as create new business models, new economic growth points and more jobs, while better regulating the segment.
The platform economy refers to the tendency of commerce to increasingly move toward and favor digital platform-based business models. These platforms allow consumers, entrepreneurs, businesses and the general public to connect, share resources and sell products or services.
The platform economy remains an important driving force for promoting high-quality economic development, said Long Haibo, a senior researcher at the Development Research Center of the State Council, adding that related supervision will become more foreseeable in the future.
Long said the latest statements mean that China will strike a balance between incentivizing and regulating the platform economy, thus sending positive signals to the market in a bid to stabilize investor expectations and confidence.
He added that the nation’s efforts to facilitate the sustainable and healthy development of the platform economy are conducive to further stimulating the innovation of platform-based enterprises amid the pandemic and enhancing their competitiveness on the global stage.
During a meeting held by the Financial Stability and Development Committee under the State Council, the nation’s Cabinet, on March 16, it was decided that governance of the platform economy should abide by the principles of market orientation, the rule of law and internationalization.