FILE PHOTO: A general view shows traffic during evening rush hour at the central business district (CBD) in Beijing, China, January 15, 2021. Picture taken January 15, 2021. REUTERS/Tingshu Wang
BEIJING (Reuters) – China’s ruling Communist Party has passed guidance for promoting the development of private firms, state media said on Friday, signalling more steps to reinvigorate a sector hurt by a round of regulatory curbs.
China will optimise the development environment for the private sector and will remove institutional barriers that prevent firms from participating in fair market competition, state media quoted a meeting of a committee on deepening reforms, chaired by President Xi Jinping.
“It is necessary to fully consider the characteristics of the private economy, improve policy implementation, strengthen policy coordination, promote precise and direct preferential policies and effectively solve actual difficulties for firms,” state media said.
China will guide private firms to find the right position in the country’s high-quality economic development, and pursue their own reforms and upgrading, state media said.
Private firms, a key driving force behind China’s economic ascent in the past four decades, account for half of the country’s tax revenue, over 60% of output and provide 80% of urban employment.
Chinese leaders have pledged to boost confidence, which has been hurt by a three-year crackdown on the tech and property sectors.
The party has also passed guidance for strengthening and improving management of the state sector, state media said.
China will deepen reforms of state firms, strengthen and improve the management of the state sector to help drive high quality development and maintain national security, state media said.
China’s economy grew at a faster-than-expected pace in the first quarter, as the end of strict COVID curbs lifted businesses and consumers out of crippling pandemic disruptions, although headwinds persist and the recovery remains uneven.
Private fixed-asset investment grew only 0.6% in the first quarter from a year earlier, dwarfed by a 10% rise in investment by state entities, official data showed.