Private firms are family

BEIJING - From discussions with national political advisors to visits to local companies, President Xi Jinping's support for China's private firms is clearly illustrated through his exchanges with entrepreneurs.

During the annual session of the national political advisory body in May 2020, Liu Yonghao, chairman of China's agricultural conglomerate New Hope Group and a national political advisor, confided in Xi about the challenges facing private companies at the time in terms of securing sales, obtaining investments and generating profits.

His insight touched the president. "Today, China's private firms thrive in a land of hope, but the land was barren when they began," Xi said. "It is laudable that they have developed to today's scale and made so many contributions."

Xi then encouraged private firms to explore and endeavor to overcome hardships amid changes "unseen in a century."

That year, China introduced extensive tax and fee cuts to help relieve COVID-19-related and other strains on market entities, and around 70 percent of the benefit flowed to private companies.

Xi's concern for the private sector is a long time coming. Back when he was the Party chief of Fuzhou City in the 1990s and later the Party chief of Zhejiang Province, he sought to help tackle difficulties for individual firms, even advising an entrepreneur to find him at his office if anything important came up.

It was thus no lip service when Xi said "private enterprises and private entrepreneurs belong to our own family" while presiding over a symposium on private enterprises in November 2018.

Xi stressed that the private economy is an essential element of China's economic system and pledged to unswervingly encourage, support and guide the development of the non-public sector.

"All private companies and private entrepreneurs should feel totally reassured and devote themselves to seeking development," Xi said.

An equally upbeat attitude is also a feature during Xi's inspection tours. Last April, at a food-processing zone for Luosifen, a noodle dish from south China's Guangxi Zhuang Autonomous Region, Xi marveled at how a bowl of rice noodles could blossom into a multi-billion-yuan business where private companies played a critical part.

"We encourage the development of private businesses. When they encounter difficulties, the Party and the state give them support, and when confusion arises, guidance is offered, with the hope that they can develop boldly and with confidence," Xi said.

China's private firms have indeed shown significant momentum in the past decade under a nurturing policy environment, increasing from 10.86 million entities in 2012 to 44.58 million in 2021 to account for 92.1 percent of enterprises nationwide, official data showed.

The private sector has become the main contributor to job creation and technological innovation and an important source of tax revenue, Xi said at the 2018 symposium.

Private firms are responsible for 59.7 percent of China's total tax revenue, 46.6 percent of foreign trade value, and 55.7 percent of fixed-asset investment in 2020, according to a report by the All-China Federation of Industry and Commerce.

The country's plans for its private sector do not stop here, with pledges for a better development environment and high-quality growth, according to the 14th Five-Year Plan (2021-2025) for National Economic and Social Development and the Long-Range Objectives Through the Year 2035.

In a letter to 100 private entrepreneurs awarded for poverty relief in 2018, Xi expressed the hope that entrepreneurs could "innovate and create without being distracted, and work in a down-to-earth way in developing their businesses."