A staff member processes motor parts at Zhejiang Jiuzhou New Energy Technology Co., Ltd. in Wenling, Taizhou, east China's Zhejiang Province, Feb. 29, 2024. (Xinhua/Weng Xinyang)

At the annual sessions of China's top legislature and top political advisory body, the development of the private sector and the well-being of private enterprises are among the issues enjoying considerable attention.

"State-owned enterprises, private enterprises and foreign-funded enterprises are all important forces in China's modernization," read the government work report approved at the national legislature.

The report also said the country will fully implement the guidelines on promoting the development of the private sector and further address problems concerning "market access, access to factors of production, impartial law enforcement, and protection of rights and interests."

Some national lawmakers and political advisors, as well as industrial insiders and experts, shared their views on both the status quo and the prospects of the private sector.

CHALLENGES

After a three-year COVID-19 epidemic, some companies have encountered challenges amid their efforts toward recovery.

Li Jun, chairman of Leyard Group, recalled that with the easing of epidemic prevention and control at the beginning of last year, the company had expected that the market would pick up quickly, so it stocked up on talents and production materials in advance in anticipation of a quick recovery.

"But economic recovery is a process that does not happen overnight," Li said.

"It takes time for the market to recover," said Cai Jinchai, a national lawmaker and president of Panpan Foods, adding that it takes time to restore consumption power and consumer confidence.

With the transformation and upgrading of the Chinese economy in recent years, some enterprises hit obstacles during the process of pursuing high-quality development.

Qi Xiangdong, a national political advisor and chairman of QAX Group, said some private enterprises encounter difficulties in adjusting structure, changing development mode and increasing investment in scientific and technological innovation.

"Some others rely too much on a single business, facing problems in transformation. There are also those enterprises that pay too much attention to short-term interests and invest less in technological innovation, which results in a lack of core competitiveness," he said.

Chen Yuyu, professor at Guanghua School of Management of Peking University, said new industries, new products and new models are emerging at an accelerated pace, and in the process of deep-level adjustment of industrial structure, more policies are needed to help enterprises change their development mode and meet the requirements of future competition.

REMEDIES

"In policymaking, all localities and government departments should heed and draw on the propositions and views of all parties concerned. They should pay attention to the views of market entities and address their concerns when formulating enterprise-related policies," read the government work report.

"Formulating policies based on the needs of enterprises and enhancing the applicability of policies will maximize the effectiveness of policies," said Liu Zibin, a national legislator and chairman of Luthai Textile Co., Ltd.

Last year, a slew of policies was rolled out to support the development of private enterprises. For example, the National Development and Reform Commission (NDRC) accelerated the introduction of projects available to private capital, while 25 specific measures were unveiled by China's central bank and other departments to strengthen financial services for private companies.

With these policies taking effect, the vitality of private economic development continues to be stimulated. In 2023, private investment (excluding real estate development investment) increased by 9.2 percent year on year. Over 32.7 million new market entities were established in China, amounting to a 12.6 percent year-on-year growth.

At a press conference held on the sidelines of the "two sessions," Zheng Shanjie, head of the NDRC, said that China will vigorously encourage and support private enterprises to participate in major national projects and projects addressing areas of weakness.

"We will continue to introduce high-quality projects to private capital, assist private capital in seeking projects and help private investment projects secure funding," said Zheng.

Pan Gongsheng, governor of the People's Bank of China, said the central bank will improve the policy framework and long-term mechanisms for financial services targeting private enterprises and small and micro enterprises, and guide financial institutions to treat enterprises of all ownership types equally.

"There are promising signals at the 'two sessions,'" said Ding Zuohong, a national political advisor and board chairman of Yuexing Group.

"We are always optimistic because we have advantages in terms of system, supply and demand, talent and innovation, and the basic trend of the Chinese economy sustaining long-term growth remains unchanged," Ding said.