To explore China's private economy in recent decades, Closer to China sits down with Quan Zhezhu, member of the 13th CPPCC Standing Committee, Deputy Director of the CPPCC Ethnic and Religious Affairs Committee since 2018. 

Starting from 2006, Minister Quan has devoted more than 10 years supporting the development of non-public sector in China. He served as former deputy head of United Front Work Department of the CPC Central Committee from 2008 to 2017, former secretary of Leading Party Group of All-China Federation of Industry and Commerce since 2006 and the standing vice-chairman of it from 2012 to 2017. He has deep understanding of China's private economy.

The following are the highlights in Quan's interview in July, 2019. The video reflects the guest's opinion, and not necessarily the views of CGTN.

What is the contribution of the private sector to China's economy?

China's private economy has been nurtured during the reform and opening-up under the CPC's leadership, guided by Party principles and policies. After the reform and opening-up, the private sector has grown out of nothing, from small to large and from weak to strong, and continues to grow.

From the perspective of the domestic economy, private businesses contribute over 50% of tax revenue, 60% of GDP, 70% of technological innovation, 80% of employment and private businesses account for 90% of all companies in China.

What are the policies about private economy?

Several measures have been taken to support, encourage and guide the private economy. It is fair to say that policies have taken shape to encourage, support and guide private enterprise.

The media have reported that after the 18th CPC National Congress, especially after the 19th CPC National Congress, the private sector has benefited. A typical example is private companies are allowed to hold a controlling interest in state-owned enterprises (SOE) as part of mixed ownership reform. 

Private funding can set up private banks under certain conditions. Previously it was impossible for private capital to run private banks. It was a major breakthrough in financial reform. 

General Secretary Xi Jinping has also pledged to ease the tax burden of private enterprises by implementing a series of widely acclaimed policies.

What is the history of private economy since the founding of P.R.C.?

In the planned economy period, Chinese people pursued "large in size and a higher degree of public ownership. A pure public economy.”

When reform and opening-up was started, Comrade Deng Xiaoping asked for a co-development of various forms of ownership, leading to a breakthrough in ownership, and he eliminated interference and remained committed to the reform and opening up.

At present times, the private sector will not die out, but will be given a broader platform with further encouragement. The primary stage of the socialist market economy with Chinese characteristics will determine the private economy development. 

How do the reform and opening-up and private economy promote each other?

The private economy's development cannot be separated from reform and opening-up, and vice versa. 

The key for accelerated development is unfettered productive forces, which can't be achieved with a single form of ownership. Thus, mixed ownership could truly realize development and meet the people's demand for a beautiful life.

The middle-income stratum is nurtured by the private economy. The private economy is the general public's economy. It is what general public have accumulated and fostered in the market. 

In addition, it has an intrinsic momentum. Various ownerships all have their strengths, and complement each other, not in isolation.

What's the influence of China's entry to WTO on the development of private economy?

China spent decades on the entry to WTO. The central authorities believed that China cannot sustain development unless to open up in a comprehensive manner. 

Problems and difficulties are temporary. Foreign capital, investment and enterprises are quite powerful. Without such pressure, however, Chinese economy cannot grow. 

Looking back, turning pressure into momentum was a good thing. Thus, China requires broader and more stable opening up to attract more quality foreign investment. China's door would never be closed as a beneficiary.

What's the relationship between socialism economy and private economy?

The socialist market economy is a major breakthrough for Chinese economy. After the reform and opening-up, especially at the Third Plenary Session of the 11th CPC Central Committee, a socialist commodity economy was proposed.

The transition of the socialist commodity economy happened around 1993. In 1992, the socialist market economy was established. Deng Xiaoping pointed out that socialism could have markets, and capitalism could have plans.

The market itself is not subject to a certain class and both socialism and capitalism could use it. So, the socialist market economy was established in China. The socialist market economy could better unfetter and develop China’s productive forces.

What are the prospects for private sector in China?

China's private economy, to a certain degree, is nurtured by the reform and opening-up. Likewise, the private economy has also promoted China's reform and opening-up as well as the modernization drive.

In 2010, only one private enterprise made the Fortune 500 list. In 2018, there were 28. In 2019, it surpassed 30. The growth is pretty impressive, which also shows a booming private business. Thus, the prospects for China's private business are quite promising.