context: The private economy is the latest target of a ‘1+N’ approach, demonstrating Beijing's understanding that strengthening the sector will take time and effort. For years, commentators have called for establishing a similar agency to raise the private sector’s profile and coordinate policy implementation.
A new private economy development bureau was announced by the NDRC (National Development and Reform Commission) on 4 September. The bureau will be organised as an internal agency within NDRC and focus on planning, coordination and policy implementation. Its main tasks include
- assessing the development of the private economy
- coordinating between different agencies
- designing new policies for private enterprises
- creating private investment opportunities
The 19 July State Council opinion on promoting the development of the private economy and the subsequent 1 August initiatives from NDRC signal Beijing sees revitalising the private sector as an important part of the Party's current policy direction. A number of provincial-level governments have responded with their own policies
- Sichuan passed measures increasing services and creating a complaint mechanism
- Fujian and CDB (China Development Bank) set up a special project targeting private investment
- Beijing and Jiangsu created new REITs (real estate investment trusts) for private investors focused on infrastructure
NDRC says the bureau’s next steps are
- creating a work mechanism
- setting a timetable for implementing measures from the July opinion
- studying the next trend in the private economy’s development
- clarifying which agencies are responsible for implementing different policies from the July opinion
- drawing up complementary policies
- setting up regular communication mechanisms with private enterprises
Tu Xinquan 屠新泉 UIBE (University of International Business and Economics) WTO (World Trade Organisation) Research Institute director says setting up the bureau as a part of NDRC was appropriate because
- it does not need a lot of resources to be effective
- using the normal legislative process to create a similar agency would have taken too long
While establishing the bureau sends a clear signal, it will not be enough to boost the private economy, says Tan Haojun 谭浩俊 China Institute of the Private Sector. That will require changes to the overall social, services and work environment, he asserts.