Carrying on the Reform to Promote Development of the Non-publicly-owned Economy

Abstract

Since the Reform and Opening-Up, China has taken a path of gradual increments in reforms and achieved economic growth that is sustained, rapid, healthy, and stable while the non-publicly-owned economy has also prospered along the path. In theory, it was a sine qua non of the construction of China’s socialist market economy to choose to develop the non-publicly-owned sector, and in practice, the development of the non-public sector has made significant contributions to the healthy advancements in China’s economic society, and it will continue to play its essential roles during the transition of the economy from high-speed to medium-high-speed growth. However, there are still many factors inhibiting its development, which includes intrinsic problems of the non-publicly-owned economy, such as development imbalance and management holes, and external factors arising from policies and institutions, such as policy biases and inhibition by resource factors, as well as issues associated with the stage of economic development, such as rapid growth in income and the pressure for Renminbi to revalue overseas but devalue domestically. Therefore, a path must be taken to promote the healthy development of the non-publicly-owned economy that values both adjustments to what has already been achieved and reforms to make further increments so that reforms will be met with less resistance and cost; at the same time, the relationship between the government and the market must be properly constructed and the government needs to loosen up on controls and rights while strengthening supervision. In addition, while the internal governance mechanism of enterprises must be well established and continuously optimized, the non-publicly-owned economy should be upgraded overall to adapt to the intrinsic rules of economic development.