• Fri. Dec 1st, 2023

Private enterprises must adapt to the rule-based market environment – Comment

Private enterprises must adapt to the rule-based market environment – Comment

A view of the CBD area in Beijing on June 20, 2023. (Photo/VCG)

Among the policy measures released by the central authorities last week, the private sector is seen not only as an important and dynamic force in the national economy, but also as a key force in stimulating the country’s modernization through high-quality development.

To promote high-quality development, China is establishing a high-level market economy, creating a market-oriented and rule-based business environment, and building a unified national market that is open, fair, efficient, and well-regulated. In this process, it is necessary to legally protect the property rights of private enterprises and strengthen the rights and interests of entrepreneurs, so that all types of owned market organizations have equal access to the factors of production, fair participation in market competition, and equal legal protection.

To that end, the government should establish a corresponding institutional and regulatory framework based on the principle of allowing the market to determine the allocation of resources. Standardization of regulatory behaviors should be strengthened to make regulatory law enforcement fair, transparent, consistent and predictable. A mechanism should be put in place to help enterprises effectively protect their rights at low cost and avoid retaliation.

At the same time, private companies must adapt to the new market regulatory environment and competitive environment through their own reform and strictly comply with the law. Private companies face challenges from market volatility and increasing their own capacity. It requires them to adapt to the higher standards of the market economy.

As the economy’s focus shifts from infrastructure to consumption, a large portion of private enterprises that depend on infrastructure and real estate may be affected. Some of them will be eliminated in the process. The public needs to properly understand that their disappearance is not the result of “property” discrimination or selective suppression.

Be it a country or an enterprise, it can only rely on modification and innovation to adapt to the new development and market environment. The country should provide a good business environment for private enterprises, while private enterprises should promote entrepreneurial spirit, increase awareness of innovation and competition, and make the private economy bigger, better and stronger.

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