(File photo: VCG)

Shanghai has announced 27 new measures to ease the financing difficulties and operation costs of private companies and protect their legitimate rights and interests.

Shanghai proposed reducing four costs to alleviate the burden on private enterprises.

For tax costs, preferential tax policies will be made full use. Tax rates in the local jurisdiction will be reduced to the lowest levels within the range set by the state.

For land costs, innovative private SMEs are offered rent concessions in state-owned industrial parks to reduce their cost of rent. The prices of new industrial land will be maintained at a lower level.

For employee costs, the city will gradually adjust the minimum wage standard and further reduce the proportion of social security contributions paid by private enterprises.

 For institutional transaction costs, Shanghai will pull out all stops to enhance the core competitiveness of private enterprises, and 90 percent of matters during the registration process will be finished at once.

To reduce the financing difficulties and lower costs of private companies, 10 billion yuan (about $144 million) will be used to establish a bailout fund for listed private enterprises, 10 billion yuan will be given away as loans for small- and medium-sized enterprises with good market performance, and the remaining 10 billion yuan will be used as collateral to guarantee funds for small and medium-size enterprises.

Meanwhile, to create a fair market environment, Shanghai will fully open the field of private investment, encourage and guide private capital to enter industries and fields not explicitly prohibited by laws and regulations, and will not impose additional conditions on private investment. The city will also encourage private capital to participate in infrastructure and public utilities and the reform of mixed ownership of state-owned enterprises. The proportion of private capital in mixed ownership enterprises will be increased and eligible private enterprises can gain the right of control. The annual government procurement project budget of municipal departments shall be no less than 30 percent for small and medium enterprises, among which the proportion for small and micro-sized enterprises shall be no less than 60 percent.

The city will make strong efforts to protect the legitimate rights and interests of private companies. In particular, Shanghai will strengthen protection of legitimate wealth and lawful property of private enterprises and entrepreneurs and handle historical issues properly.

(Compiled by Wang Xiangyu)