On September 28, 2024, Zheng Shanjie, the head of China's National Development and Reform Commission (NDRC), assured private entrepreneurs that the government would 'spare no effort' to help them overcome the difficulties they face. This commitment comes as the private sector plays a crucial role in China's economy, contributing over 50% of tax revenue, 60% of GDP, and 70% of technological innovation. Despite this significant contribution, private investment has seen a decline of 0.2% in the first eight months of 2024, prompting concerns about the economic landscape.
In response to these challenges, the NDRC established a private economy development bureau in September 2023, signaling a more structured approach to supporting private enterprises. The Politburo has also convened meetings to discuss strategies for stabilizing the private sector and addressing issues within the property market. President Xi Jinping has emphasized the need for confidence and urgency in economic work, highlighting the government's recognition of the private sector's importance in driving economic growth.
These recent initiatives and reassurances from top officials reflect China's broader strategy to foster a favorable business environment for private enterprises. By enhancing policy support and addressing the challenges faced by private firms, the government aims to stimulate investment and innovation, which are critical for the country's economic recovery and long-term growth. The NDRC's proactive stance is part of a larger effort to stabilize the economy and ensure that private enterprises can thrive in a competitive market.