China created a new agency with a positive hope to grow private enterprises in the country and take the sector to a new level. The government of China approved the formation of a special body whose focus will be on nurturing the growth and development of the private sector.
The body is formed as per the recommendations of the National Development Reforms Commission. The NDRC announced this development on Monday, which shows that China is strategically shifting its approach to support the economy of its private sector.
The hope is that the newly created agency will play a very important part in shaping the future landscape of Chinese private enterprises. The body has two roles to play in this regard –
Firstly, it has to create and implement policies so as to help the expansion and growth of Chinese private companies both domestically and internationally. Secondly, it will create a troubleshooting and support mechanism so that private businesses are able to encounter obstacles and challenges.
According to US News,
“The private sector is responsible for 80% of new urban jobs but has struggled to attract investment amid a frail economic recovery over the first half of the year, with business owners also constrained by weak domestic demand.”
The Chinese Government has been really enthusiastic to create this special body. Zhang Shixin, an official among the state planners, stated the high significance of this initiative. He also emphasized and praised the Chinese Communist Party Central Committee’s commitment to bolstering the country’s private economy.
The Chinese economy faced many issues in the first half of 2023 due to its fragile recovery, as well as a weak consumption demand domestically. In addition to this, there were many concerns related to high levels of debt and other financial risks. These are some of the factors that tempted the government to take necessary steps.
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