China to ‘unswervingly’ support private sector: Xi

BY GLOBAL TIMES and SILVI WRITER

 

Chinese President Xi Jinping said on Thursday that China will unswervingly support the development of the private sector and vowed to create a better legal environment for private companies.

“We will unswervingly develop the public sector and will unswervingly encourage, support, guide and protect the development of the private sector,” Xi said in a visit to China Zhongwang Holdings Limited in Northeast China’s Liaoning Province.

The President’s comments come as a debate about the relationship between the country’s State-owned enterprises (SOEs) and private firms continues to gain traction on Chinese social media.

China’s social media have been abuzz with worried commentaries since Wu Xiaoping, a self-claimed ‘veteran in China’s financial sector’, posted a blog post in mid-Sept, boldly claiming that China’s private sector has “basically fulfilled its task of assisting the state-owned economy in achieving its rapid development”.

As a result, Wu went on to say, “China’s private sector should not blindly expand. A new form of more concentrated, unified, and scaled-up economy of mixed ownership … may gain a greater share.”

Merging China’s private sector into the state-owned sector, according to Wu, is ‘the only way’ to respond to the US-led Western containment against China and fight back against US President Donald Trump in the trade war.

Wu’s blog post has set off alarms among Chinese entrepreneurs, many of whom interpret it as a dark omen that, in times of economic difficulty, the state may be tempted to appropriate the wealth of the private sector.

But Xi pointed out that many of the country’s reform efforts are aimed at further developing the private economy and urged private companies to have confidence.

“We will create a better legal environment and further improve the business environment for private companies,” he said.

“The Communist Party of China’s guiding principles are beneficial to the development of private companies,” Xi said.

“Private enterprise owners should also spare no efforts in developing more first-rate products.”

At a visit to a subsidiary of China National Petroleum Corporation in Liaoning earlier on Thursday, Xi also stressed that talks and arguments about getting rid of State-owned enterprises or diminishing SOEs are “wrong and one-sided.”

“Any thoughts or remarks that doubt and badmouth SOEs are wrong,” he said, adding that China will continue its basic economic system with public ownership playing a dominant role and diverse forms of ownership developing side by side.

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