Chinese Vice Premier Liu He expresses support for private sector

Chinese Vice Premier Liu He vowed firm support for the country's private sector. “China's policy to support the private sector hasn't changed, and won't change in the future,” Liu said in a video speech at the opening ceremony of the China International Digital Economy Expo 2021 held in Shijiazhuang, capital of Hebei province on September 6. China will help the private sector play a bigger role in stabilizing growth and employment, adjusting the economic structure, and encouraging innovation, Liu said, stressing the importance of protecting fair competition, and opposing monopolies in further developing the digital economy. The Vice Premier reiterated that the private sector plays an important role in the economy, contributing more than 50% of taxes, 60% of GDP, 70% of technological innovation, 80% of urban employment and 90% of new jobs and firms.

Liu's speech was a clear sign that the government wants to mitigate concerns of private enterprises, and it also indicated that anti-monopoly efforts will continue, telling entrepreneurs to bravely innovate, to conform to international rules, and assuring them that they will be better protected, Wei Jianguo, a former Chinese Vice Minister of Commerce, told the Global Times. The reassurance came after tightened restrictions from the central government have affected a range of sectors, leading to drops in the stock prices of many enterprises. The move has also led to worries and anxieties about the prospects of the industry among domestic industry players and foreign investors. Subsidies for small start-ups haven't vanished despite tightened measures imposed on leading industry giants, while the internet sector, which has driven the Chinese economy for the last two decades, will continue to develop, according to Vice Premier Liu.

The tightening of regulations has created a better environment for the country's small players. As of July, 13.94 million new market entities nationwide had been established, recovering to pre-epidemic levels, according to the State Administration for Market Regulation (SAMR). The Administration said that it will pay greater attention to strengthening supervision and anti-monopoly efforts, combating unfair competition, and preventing the disorderly expansion of capital. Yao Yang, Dean of the National School of Development at Peking University, told the Global Times that worries that the antitrust measures aim to advance the state sector while resulting in the retreat of the private sectors are utterly groundless, the Global Times reports.