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CHINADAILY Editorial

Healthy development of private economy essential: China Daily editorial

chinadaily.com.cn | Updated: 2018-09-13 22:06
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Despite people's growing immunity to outlandish claims of self-declared "experts", when an article by a "veteran financial industry insider" appeared online the other day, the impact was seismic.

Not because there was any unusual revelation, or anything worth a fuss, but mostly because of its eye-catching headline: "Chinese private economy has fulfilled its mission to assist development of the public economy, and should gradually fade out".

Though few people have read the article in its entirety, or even bothered to find it online, the viral, reposted screenshot highlighting that sensational headline alone was enough to take many aback.

Given the sensitivity of the issue and its significance to the development of the world's second-largest economy, there have been mixed reactions to it, from denouncement to speculation on whether it is a trial balloon hinting at new policy orientations.

Had the official Economic Daily not reacted, laying bare its fundamental logical fallacy and contradiction with national policies, and the People's Daily not endorsed it immediately, it would have been extremely difficult to contain the spread of the contagious fear of an unprecedented policy reversal.

The two authoritative newspapers' timely clarification was of critical importance, because there indeed is the need to reiterate the national leadership's unchanged faith in the positive role of the private sector and continuing commitment to its prosperity at such a tricky juncture.

The controversial article was misleading not only because it under-appreciated the invaluable and indispensable role private enterprises have played in China's economic development, but also because it ignored the vital fact that they outshine the mammoth yet less efficient State-owned enterprises in contribution to gross national product, job creation, absorption of laborers transferred from the countryside, newly added jobs, and taxation.

In particular, it goes against our Constitution, whose Article 11 defines nonpublic economies as "important components of the socialist market economy", and promises to "encourage, support and guide" their development.

Successfully averting a potentially dangerous public opinion crisis does not mean everything will since be fine. There would not have been any confusion were it not for society's growing anxiety over the difficult condition some private companies are in now and the broad concerns about their difficulty in getting financial assistance.

That means we need concrete measures to create a fair and open environment for the sustainable and healthy development of the private economy, and to consolidate the confidence of entrepreneurs.

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