China has passed its first national law dedicated to protecting and promoting the private sector, a move experts describe as a "historic milestone" offering legal safeguards for businesses amid global economic turbulence. The legislation, ratified by the Standing Committee of the National People's Congress, will take effect on May 20, 2025.
A New Era for Fair Growth
The 78-article law addresses long-standing concerns such as fair market access, financing barriers, and innovation protection. Li Hongjuan, deputy director of the NDRC's Private Economy Office, emphasized that the law elevates protections to a statutory level, marking a "crucial milestone" in China's economic development. "This legal framework directly responds to the private sector's urgent demands," Li told state media.
Timely Response to Global Challenges
With private enterprises contributing over 60% of China's GDP and 80% of urban employment, the law aims to stabilize domestic growth drivers. It prohibits abusive administrative measures in economic disputes and standardizes cross-regional law enforcement – addressing pain points like discriminatory practices that previously slowed private investment.
Institutionalizing Support
The law builds on recent initiatives, including a dedicated NDRC bureau for private enterprise coordination established earlier this year. Analysts note it aligns with China's broader push for high-quality development, reaffirmed during a high-level leadership symposium in February.
As global trade tensions persist, this legislative framework underscores China's commitment to stabilizing its economic foundations while fostering innovation-led growth.
