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Xi pledges supportive policies to private businesses amid economic slowdown

Xi Jinping Photo: Asia Times

Chinese President Xi Jinping has pledged a series of supportive policies to the country’s entrepreneurs amid recent concerns that state-owned enterprises may suppress the development of private businesses.

On Thursday, Xi presided over a symposium at the Great Hall of the People in Beijing to hear opinions and suggestions from dozens of representatives from large companies – including Pony Ma of Tencent and Robin Li of Baidu.

Wang Yang, Wang Huning, and Han Zheng, all members of the Standing Committee of the Political Bureau of the CPC Central Committee, also attended the symposium.

Xi shook hands with the business leaders, and told them: “I’m here today to boost your confidence,” according to state media.

In his speech which was carried by state-run Xinhua News Agency, Xi refuted recent remarks that private businesses have completedtheir missions and will fade out, saying that in the process of completing the building of a moderately prosperous society in all respects and further fully building a modern socialist China, private economy would only get “stronger” and could not be “weakened”.

“Any word or action that denies, doubts or wavers over the country’s basic economic system is not in line with the principles and policies of the Party and the country,” he said.

Xi said private economy had contributed much to the country’s “entrepreneurship, employment, innovation and revenue”, and that Beijing’s policy of “encouraging, supporting and guiding” private economy and “providing” a sound environment and more opportunities to the sector “have not changed”.

“The basic economic system of retaining a dominant position for the public sector and developing diverse forms of ownership side by side is an important part of the system of socialism with Chinese characteristics and crucial for improving the socialist market economy,” he said.

Xi told the gathering that the Party’s support would involve “substantial” tax cuts for private businesses – entrepreneurs have long complained that Beijing’s tax system is not business-friendly.

He also said banks would be encouraged to lend more to private borrowers and ordered local governments to “rescue” troubled private sector firms, saying they could “conduct necessary financial rescues of private businesses with good business prospects”.

Provincial and municipal authorities, meanwhile, had been told to “raise funds” to bail out private businesses if needed, Xi said.

In addition, Xi promised market access and equal treatment for private businesses, especially when it came to government campaigns to reduce capacity and pollution, responding to a common complaint that the government favors state-owned firms over private ones in implementing regulations.

He also said, “Party committees and governments at all levels should spend more time and energy caring for private enterprises and entrepreneurs, listening to their opinions and appeals and taking initiatives to help them solve problems.”

And Xi again tried to reassure the private sector that Beijing would protect the personal and property rights of entrepreneurs.

“When performing their duties, disciplinary and supervisory agencies should not only solve cases but also safeguard legitimate personal and property rights and protect the lawful operation of businesses,” he said.

Private economy contributes 60 percent of China’s gross domestic product and 80 percent of the country’s jobs.

However, due to the economic slowdown and the Sino-US trade war, many entrepreneurs are feeling increasingly insecure.

According to a report cited by financial media group Caixin, the revenues of state-owned enterprises for the first three quarters of this year was 1.53 trillion yuan, up 21.6 percent compared to the same period last year, while the figure for private businesses was 1.26 trillion yuan, down 31.1 percent.

In response, authorities have recently rolled out a series of policies including cuts in reserve requirement ratio for lenders, tax reduction, adequate financing and more infrastructure spending to help troubled private businesses.

A politburo meeting chaired by Xi on Wednesday said the government would take more timely steps to support the economy, which faces increasing pressure.

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