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China set to make strides toward better business environment

Xu Wei
Updated: Jan 3,2018 9:09 PM

China will work to better the business environment with measures to further streamline administration and reduce corporate burdens, according to a decision made at a State Council executive meeting chaired by Premier Li Keqiang on Jan 3.

To further improve the business environment, the government will prioritize cutting red tape, taxes and fees. The negative list for market access will be implemented across the board. The practice of “one-stop and one-form” application for foreign-invested ventures in terms of record-filing and business registration will be introduced nationwide, according to a decision at the meeting.

Enterprises of various ownerships will be treated the same in qualification and approval, government procurement, major projects in science and technology, and setting standards. Properties of various types will receive equal protection, and more efforts will be made to protect intellectual property rights.

In his report to the 19th National Congress of the Communist Party of China, General Secretary Xi Jinping said that we will sort through and do away with regulations and practices that impede the development of a unified market and fair competition, and promote and facilitate high-standard free trade and investment.

“We should improve investment and market environment, make bigger strides in opening-up, reduce the cost of market functioning and create a stable, fair, transparent and predictable business environment. In this way we can speed up the development of new institutions of the open economy and promote sustained and sound economic growth,” he added.

Premier Li said that improving the business environment will help unleash productivity and enhance competitiveness, and fostering a sound business environment will lay an important foundation for developing a modern economic system and promoting high-quality development.

“Greater efforts should be made in streamlining administration, enhancing compliance oversight and delivering better services to foster an internationally competitive business environment that provides equal treatment of domestic and foreign enterprises and stimulates the vitality of market entities and social creativity,” he said.

China was ranked 78th in ease of doing business according to a 2017 report by the World Bank, up from 96th place in 2013.

A series of measures have been adopted by the current government to cut red tape, reduce corporate burdens and improve the business environment. It has canceled or delegated administrative approval by State Council bodies on 697 items, accounting for 45 percent of the total. The government also shortened the list of intermediary services for administrative approval by 323 items, or 74 percent of the total, and canceled professional qualification and certification requirements for 434 items, more than 70 percent of the total.

It was decided at the meeting that more efforts will be made to slash or cancel fees paid by enterprises, including operational and service fees and fees charged by industry associations and chambers of commerce. Costs for customs clearance will be lowered.

The government will further simplify the procedures for administrative review and speed up approval procedures for business startups, tax payments, application for construction permits, and water, electricity and gas services, and real estate registration. Slashing electricity costs will also be a priority.

A new oversight mechanism characterized by integrity commitment and information disclosure will be established at a faster pace. A unified punishment mechanism for breaches will be improved.

An evaluation mechanism for business environment will be established, and gradually rolled out nationwide. Special measures by sector will be unveiled to facilitate the application for construction permits and cross-border trade.

“There is still much more that we can do to streamline administration, enhance compliance oversight and improve services. We should foster a more enabling business environment to incentivize a visible improvement in the ease of doing business for entrepreneurs, market entities and the general public,” Premier Li said.