Beijing is poised to add more detailed measures to its draft private economy promotion law, after last month’s second review of the proposed legislation by lawmakers sparked wider discussions on market entry and enforcement issues, analysts said.
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The drafting of the law began last year as the Chinese authorities made the revitalisation of domestic dynamism a priority. However, it was not deliberated over or passed at the annual session of the National People’s Congress (NPC) – the country’s top legislature – which concluded on Tuesday.
That may be due to the complex nature of the new law, which is designed to augment legal protections, and should not be interpreted as a delay, said Tang Dajie, a senior researcher with the China Enterprise Institute think tank in Beijing.
“The law may still need to be tweaked to incorporate feedback and implementation details,” he said. “It may be passed when the NPC’s Standing Committee meets in April or June.”
The proposed law is part of Beijing’s efforts to reboot the slumping private sector, as the Chinese economy braces for more external challenges amid rising geopolitical and trade rifts.
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China’s unbalanced economic recovery, sluggish consumption and regulatory uncertainties have sapped investor sentiment for years. The private sector’s long-standing gripes, including the curtailment of market access and perceived favouritism towards the state sector, are yet to be fully addressed, even though the private sector accounts for 60 per cent of the country’s gross domestic product.