Encouragement and support for private sector will continue
China Daily

An employee readies a bartending robot at the CIFTIS exhibition venue in Beijing. (Photo: China Daily)

The report delivered at the opening of the 20th National Congress of the Communist Party of China called for building a high-standard socialist market economy.

It pointed out that the country must uphold and improve China's basic socialist economic system, unswervingly consolidate and develop the public sector and unswervingly encourage, support and guide the development of the non-public sector. It called for the market to play a decisive role in resource allocation and for the government to better play its role, stressing that the authorities should provide an enabling environment for private enterprises, protect their property rights and the rights and interests of entrepreneurs in accordance with the law, and facilitate the growth of the private sector.

This should dispel some people's doubts over the prospects for the non-public sector. To reiterate the significance of this point at this time is not only to affirm the importance of public ownership, but also to emphasize the important driving power of the private sector.

It is wrong for some to allege that the non-public sector is becoming less important than before, even if the harsh external development environment has underscored the importance of the public sector. This misreading hurts the market, weakens market expectations, and reduces the market's willingness to invest.

Of course, some doubts about the importance of the non-public sector are not without reason. The authorities must resolutely stop, crack down on and ban activities that illegally accumulate wealth by taking advantage of loopholes in the regulation of the capital market and that empty the real economy by taking advantage of the financialization of the economy.

Yet capital is an indispensable factor of production in a socialist market economy, and the socialist market economy is an irresistible trend of the economic development. In practice, some departments and local governments have either acted in haste or acted on their own, resulting in certain market misunderstandings.

Relevant laws and regulations on the definition and handling of capital's disorderly expansion and "traffic lights" should be established and improved in a timely manner, and the government should not impose its will on market laws.

It is the development of the public and non-public sectors of the economy that has enabled China to carry out its reform and opening-up policies. There is no reason why the country should not adhere to that so that it can continually press ahead with the modernization of socialism with Chinese characteristics.