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Premier underscores importance of market entities

Updated: Mar 12,2021 05:37 PM    english.www.gov.cn

Premier Li Keqiang repeatedly stressed the importance of market entities at the press conference on March 11 after the closing of the fourth session of the 13th National People's Congress.

In generating jobs, the Premier said, China will continue to enable the market to play a principal role and promote employment by supporting market entities. On macroeconomic policies, the Premier said support for employment, people’s well-being, and market entities will remain undiminished. He also stressed that the centerpiece of reform will align macro policies with the needs of market entities to provide relief and energize them in a bid to consolidate the fundamentals of China’s economy.

“Over the past 40 years of reform and opening-up, we have been developing a socialist market economy to boost market entities so that the market can play a decisive role in allocating resources and the government can better play its role,” the Premier said.

“Last year, we said we would help keep market entities afloat. This year we will work to sustain and revitalize the market actors, as their surviving and thriving is critical for the vitality and resilience of China’s economy,” the Premier added.

Market entities show great resilience

A CNBC reporter posed the first question, asking how the coronavirus pandemic has affected the quality and salary of China’s jobs in the last year and what specific measures China will take to improve the situation.

To answer the question, the Premier told a story first: “In the raging times of COVID-19 last year, when bustling streets were deserted and shops were closed, our biggest concern was massive job losses. I recall visiting a small shop during a local inspection tour. The shop owner told me that he had practically no business for almost three months, but thanks to the government support in tax and fee cuts, exemptions on utility bills and rent, and wage subsidies, he managed to pull through and didn’t let any employees go.”

The Premier said he asked the shop owner if he could still afford to pay his employees wages. The owner replied that he gave them some living allowances. There were some 20 employees there, all saying they had nothing to complain about when they could still have something to cover their basic needs in such difficult times.

“Both the company and the employees were aware that as long as the company and jobs were there, once production was resumed, business would go up,” the Premier said.

He thereby stressed that employment is very important to every family and the country, since it has a vital bearing on people’s livelihood, and serves as the foundation of development and a source of wealth. Employment can generate income, thus help boost consumption and drive economic growth.

“Last year, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, and thanks to joint efforts made by all sides, the market entities showed great resilience, and our people faced the difficulty in solidarity. For the whole year, we added 11.86 million new urban jobs. The economy expanded by 2.3 percent. There was continued increase in household incomes. All these performances were better than expectations,” said the Premier.

“We have set the projected target of no less than 11 million new urban jobs for this year, and we hope to go beyond it in actual implementation,” said Premier Li.

“In generating jobs, we will continue to enable the market to play a principal role. In other words, we will continue to promote employment by supporting market entities,” he added.

The Premier put forward some methods to improve employment, saying that China will stabilize and expand employment, while opening up new channels for job creation. Also, flexible employment will be further encouraged.

“Our country has a 1.4 billion population. The labor force remains our most abundant resource. Our people are hardworking and resilient. Whenever there is an opportunity, they will seize it and put their talent to good use,” said the Premier.

The Premier stressed that a good life hinges on diligence. “I believe with the hard work of our people, we will be able to achieve common prosperity over time,” he said.

Steady pace to sustain development

The Premier also mentioned market entities when answering a question about macro policies.

He said China’s GDP growth target of above 6 percent has aroused much attention, emphasizing that the economy has just recovered, with many incomparable factors, and there is also great uncertainty in global economic recovery.

"By setting the GDP growth target at above 6 percent, we have left possibilities open, which means in actual delivery, there may be even faster growth," Premier Li said.

"We will further consolidate the foundation of economic recovery, promote high-quality development and make our development truly sustainable. This target should also be aligned with what we can accomplish next year and the year after next.

"Growth too fast will not be a steady one. We need a steady pace to sustain China’s development," the Premier stressed.

"In the face of unprecedented severe shocks last year, we acted in a prompt, decisive and focused manner. We did not flood China’s economy with massive liquidity," he said. "The increased fiscal funds totaling 2 trillion yuan were mostly used to support market entities and people’s well-being by offering tax and fee cuts and meeting basic living needs. They were allocated directly to primary-level governments in as short as seven days, to make sure local governments have enough fiscal resources for tax and fee cuts and job retention."

When asked whether China would tighten its macro policies this year, Premier Li said China didn’t use quantitative easing last year, so this year there is no need for sudden shifts in policies. The consistency and sustainability of the policies will be sustained with a focus on solidifying the positive momentum of an economic rebound.

"As economic rebound is solidified, we will make appropriate adjustments to some policies introduced last year. Some temporary measures may be undone, but we will introduce new structural tax and fee cut policies to offset the impact of their drawdown. Our support for employment, people’s well-being, and market entities will remain undiminished."

In terms of financial policies, he said they will involve reducing central government expenditures, with governments at all levels tightening their belts, as well as expanding the coverage of funds directly allocated to primary-level governments to continuously benefit market entities and the people, the Premier said.

Financial support will also be in place, he said, to encourage financial institutions to offer more accessible and affordable financing to smaller firms while stabilizing the leverage ratio.

Market entities to be energized

In response to the question of what measures the government will take this year to alleviate the difficulties of enterprises, Premier Li regarded market entities as the main thread.

“The centerpiece of our reform last year was to align our macro policies with the needs of market entities,” Premier Li said. 

“During the 13th Five-Year Plan period, over 60 million new market entities were registered. Last year, especially in the latter half, with the economic rebound, we saw another upsurge in the number of new market entities. Now there are some 130 million market entities in China. Last year, the number of self-employed individuals increased by over 10 million, rising from 80 million to the current 90 million, providing 200 million job opportunities.

“To energize market entities, and stimulate their vitality, are the main purpose of government reform,” Premier Li said.

Premier Li said the government will continue to center its policies on the needs of market entities and deepen reform in streamlining administration, delegating power and improving services to sustain and revitalize the market players. An important part of the reform of government functions is to allow market entities to make their own decisions wherever necessary.

While talking about streamlining, Premier Li said the government will continue to streamline the administrative review process in terms of procedures, documents, fees and time needed to lessen the burdens on market entities and free up more space for them to compete freely in the market.

Premier Li said the government will improve the regulation to ensure fairness in the market. The government will streamline administration and enhance supervision, by developing new regulatory approaches and enhancing compliance oversight. "Those are all part of the reform package," he added.

“We will continue to support the Internet Plus model and Internet of Things as new forms of industry and business. We will combat such malpractices as cheating in the marketplace, counterfeiting, acts of bad faith, fraud, and illegal fund-raising in the name of new forms of industry, because these malpractices disrupt market order and undermine fairness. Without fairness, neither competition nor market vitality would be possible,” the Premier said.

Mentioning government service, Premier Li said the government will deliver better services and foster an enabling environment for all companies that put quality first, act in good faith and concentrate on making their products and services more competitive. As for high-demand government services, the government will work hard to make them accessible online through smart phones on a one-stop basis.

Market entities will be further energized and social creativity boosted, he added.

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