The State Council issued a circular, proposing six tasks and eight measures to reduce costs for enterprises to ensure a stable growth for real economy.
According to Liu Shengjun, deputy director of the China-Europe International Business School at the Lujiazui International Finance Research Center, the circular is necessary and important for supply-side structural reform.
“To relieve burdens for real economy, we should be clear of the general direction, and also specific measures. The recently released circular clarified the two aspects,” said He Weida, professor of Economics and Commerce at the University of Science and Technology Beijing. “The six tasks in the circular contain real economy enterprises’ major problems of high cost. It shows the government’s determination to reduce costs, and help improve enterprises’ competitive power.”
Wu Qing, a researcher at the Research Institute of Finance, Development Research Center of the State Council (DRC), said that some costs, such as taxes and financing, can be controlled.
“It is very important to reduce the costs for institutional transactions. This can help eliminate systematic barriers. Specific measures such as accelerating the establishment of a social credit system can help improve the environment for enterprises and reduce costs for them,” He said.
Judging from the statistics of the past few months, some previous policies have already taken effect. “With the implementation of the recently issued circular, real economy enterprises’ costs will be further reduced in the second half of the year,” said He, adding that efforts should not only be made by the government, but also by enterprises.
Enterprises should enhance self-administration, innovate management and optimize organization structure, said Li Zuojun, deputy director-general of research at the Institute of Resources and Environment Policies of DRC.