A Promising Future
When attending a symposium on private businesses on 17 February, Chinese President Xi Jinping underscored the immense opportunities within China’s private economy. He stated that the private sector enjoys broad prospects and great potential on the new journey in the new era, and that it is a prime time for private businesses and entrepreneurs to give full play to their capabilities.
One month later, the private economy once again took centre stage during the Two Sessions - the annual gatherings of China’s top legislature, the National People’s Congress (NPC), and the top political advisory body, the National Committee of the Chinese People’s Political Consultative Conference (CPPCC).
The Government Work Report delivered during the sessions highlighted the private economy multiple times, igniting discussions among the lawmakers and political advisers. Representatives from the private sector, drawing on their first-hand experiences, shared valuable insights on advancing high-quality development. Their discussions covered key areas such as policy support, business environment optimisation, capital market empowerment, and technological innovation, demonstrating strong confidence in the private economy’s future.
The report reaffirmed China’s unwavering support for the private economy. Citing the deliberation of the draft private sector promotion law, it underscored the nation’s commitment to ensuring equal legal protection for private businesses. Entrepreneurs praised key policy initiatives, including the establishment of a unified national market, the development of a strong talent pool, and the introduction of financial relief measures and consumption stimulus policies - steps they believe have significantly bolstered confidence among private businesses.
Wang Mingfan, a CPPCC National Committee member and chairman of Boton Group, a leading player in China’s flavours and fragrances industry, highlighted that the private economy’s future remains bright, driven by sustained institutional advantages and a steadily improving macroeconomic landscape.
Private businesses account for over 92 percent of China’s total businesses, playing an indispensable role in the country’s economic growth. As the world’s second-largest economy, China contributes about 30 percent to global economic growth annually. The high-quality development of its private economy is crucial for both national and global economic stability.
“The report’s emphasis on increasing policy support for private economic development will further inspire entrepreneurial enthusiasm and instil confidence in global economic recovery,” Wang remarked.
Enhancing business environment
During a discussion with the Jiangsu Province delegation to the Two Sessions on 5 March, President Xi emphasised the need to fully implement the key points from the symposium on private businesses and ensure fair treatment for all enterprises, regardless of ownership structure. Echoing these sentiments, Wang said, “A favourable business environment is the foundation for the growth of private businesses.”
Guangdong Province, where Wang’s enterprise is headquartered, has long been a thriving hub for private sector growth. With strong policy support, a dynamic market, well-developed infrastructure, and abundant financial resources, the province presents vast opportunities for businesses. Local governments have significantly enhanced administrative efficiency by streamlining processes, reducing bureaucratic red tape, and cutting time costs. Wang credited Guangdong’s exceptional business environment as a key factor in his company’s successful global expansion.
Huang Yong, an NPC deputy and chairman of Tuzhi, a high-tech company based in Guizhou Province, underscored the need to strengthen legal protections for the property rights and independent operations of private businesses. He called for a more equitable property rights protection framework and enhanced policy support, including tax reductions and simplified procedures for obtaining financial assistance. Additionally, he advocated for improvements in government-backed financing guarantees to expand private enterprises’ access to credit support while lowering financing costs.
Recognising the financing challenges faced by private enterprises, especially small ones, the report stressed the importance of optimising and innovating structural monetary policy tools to enhance support for these businesses.
NPC deputy Li Dexiang, chairman of a supermarket chain in Guizhou Province, expressed concerns over challenges posed by rising costs in labour, rent, electricity, logistics, and warehousing, as well as e-commerce competition. He urged policymakers to introduce more supportive measures for labour-intensive businesses and to facilitate capital market engagement in the brick-and-mortar retail sector.
Despite progress, financing difficulties and high borrowing costs remain major concerns for private businesses. During a ministers’ passage interview session on 5 March, Li Yunze, minister of the National Financial Regulatory Administration, outlined efforts to address these issues through a dual strategy: increasing financial resources and reducing financing costs. The former entails expanding financial institutions’ lending to private businesses, while the latter involves policy guidance, market-oriented measures, and digitalisation to lower hidden financing expenses.
Embracing high-quality development
At the start of 2025, DeepSeek, Unitree Robotics, and four other startups in Hangzhou, Zhejiang Province - collectively known as the Six Little Dragons - gained nationwide recognition for their breakthroughs in frontier fields such as artificial intelligence, robotics, and brain-computer interfaces. Their success highlights the rise of innovative private enterprises as China advances its technology-driven growth strategy.
Huang attributed their success to the joint efforts of the government, businesses, and investors. He suggested that national technology authorities support private enterprises by fostering innovation platforms and enhancing collaboration with universities and research institutions to facilitate the seamless industrial application of technological advancements.
The Report on the Work of the Government also emphasised accelerating the digital transformation of manufacturing. NPC deputy He Xiaopeng, chairman of new energy vehicle (NEV) manufacturer XPeng, predicted that humanoid robots could become as transformative as NEVs within the next two decades. He suggested applying early-stage market cultivation strategies from the NEV sector to drive their adoption. Meanwhile, industry leaders such as Pan Baochun of Royalstar, a home appliance manufacturer headquartered in Hefei, Anhui Province, and Zhou Shanhong of Vansun Group headquartered in Jiangsu Province, pledged increased investment in intelligent housing and AI-powered energy solutions.
Zhang Xinghai, a member of the Standing Committee of the CPPCC National Committee and chairman of NEV manufacturer Seres, advocated for greater private sector involvement in national strategic industries. He also called for increased investment in research and talent development to enhance competitiveness. CPPCC National Committee member Chen Zhilei emphasised the need for policies that integrate private businesses into national technological innovation agendas.
With sustained policy support and an improving market environment, China’s private economy is set for robust growth. As policies create new opportunities and businesses leverage their entrepreneurial spirit, the private sector will continue to drive high-quality development and play a vital role in China’s economic prosperity.
