Guangdong keeps it simple for growth

Guangdong province, the pioneer of China's opening-up and reform policy, has taken the lead in administrative reforms to unleash the potential of the economy, especially in the private sector.

These reforms are having an impact. Last year, the provincial government abolished or delegated to lower levels 69 administrative examination and approval items, according to the government work report delivered by Guangdong Governor Zhu Xiaodan at the annual session of the local legislature on Feb 9.

Zhu said that the province will further streamline and delegate its approval and review powers this year.

In 2012, the State Council gave Guangdong, a business hub in South China, approval to test further reforms of the administrative examination and approval system. Since then, the provincial economic and information commission has abolished or delegated dozens of such powers, an official of the commission said in September.

For example, among the 21 abolished items, seven were eliminated so as to lower the threshold for market access, 10 were abolished to simplify the approval procedures and four were abolished to ensure fair competition.

"The private sector and small and medium-sized enterprises are important players of the market economy. They are the biggest beneficiaries of the reform of streamlining administration and delegating power to lower levels," said He Zuoxian, deputy director of the provincial bureau of SMEs under the commission.

Statistics from the commission showed that the private sector generated 51.7 percent of Guangdong's gross domestic product in 2014. The sector's added value hit 3.5 trillion yuan ($568.5 billion), up 8.3 percent year-on-year.

The value added of industrial enterprises with an annual revenue of more than 20 million yuan increased 8.4 percent to about 2.9 trillion yuan in 2014.

Among such enterprises, SMEs and private-sector companies recorded growth of 12.4 percent and 13.2 percent, respectively.

Guangdong's industrial and commercial authorities revised the business licensing procedures and the goal was to change the overall basis of administration to "supervision" from "pre-approval".

The number of enterprises registered in Guangdong has soared since the province became the test area for commercial registration system reform in 2012. Nearly 1.2 million enterprises registered between January and November last year, the most of any province or autonomous region in the country. Total registered capital increased 143.4 percent year-on-year.

"We relaxed the examination and approval process before issuing business licenses to make it easer for a new player to enter the market. But it is important to tighten supervision at the same time," said Zhang Zhiyun, an official in charge of commercial registration at Dongguan's administration for industry and commerce.

To improve supervision, the Dongguan government created an online platform for more than 20 departments - including industry and commerce, tax and quality supervision - to pool the results of their monitoring of illegal activity.

By reforming the administrative examination and approval system, the government is delivering the message to the public that "the government is a public servant instead of a power holder", said Zheng Canru, head of Nanhai district, Foshan.

(China Daily 02/28/2015 page6)