China is taking significant steps to foster a more favorable business environment for private enterprises. On December 21, the draft law on private sector promotion was submitted to the Standing Committee of the 14th National People’s Congress (NPCSC) for review.
The proposed legislation aims to solidify the legal framework for private sector development in China. Experts believe this move will not only bolster the confidence of private entrepreneurs but also contribute to the country’s overall economic growth.
“Elevating measures to promote private enterprise development into legal norms is of profound significance,” said Wang Xiang, director of the Legislative Planning Office of the Legislative Affairs Commission of the NPCSC. “It will further optimize the development environment for the private sector, accelerate the construction of a new development pattern, and promote high-quality development.”
Over the past decade, China has witnessed remarkable growth in its private sector. Between 2012 and 2023, the number of private enterprises increased from 79.4 percent to 92.3 percent of the country’s total enterprises, reaching over 53 million. Additionally, the number of individual businesses rose from over 40 million to 124 million, generating nearly 300 million job opportunities. Private businesses have become the backbone of the Chinese economy.
This year’s Central Economic Work Conference stressed the importance of deepening economic reforms in 2025 and implementing landmark reform measures. The conference highlighted the need to accelerate the deepening and upgrading of state-owned enterprise reforms and enact the law on private enterprise promotion.
Bi Jiyao, a researcher at the Chinese Academy of Macroeconomic Research, emphasized the need to create a more favorable environment for private enterprises and provide them with more opportunities. “This will further enhance the confidence of private entrepreneurs, stimulate their motivation organically, and enable them to play a more active role in stabilizing growth and employment,” Bi said.
He also noted the importance of holding local governments accountable for resolving outstanding payments owed to private enterprises and cracking down on arbitrary charges, fines, inspections, and seizures to effectively protect the legitimate rights and interests of private enterprises across China.
Reference(s):
China moves to strengthen legal protection for private enterprises
cgtn.com
