Both the public and non-public sectors of the economy as components of the socialist market economy
Since China introduced the reform and opening up policy more than 30 years ago, it has gradually adjusted its ownership structure, changing the proportions of the public and non-public sectors in pushing up economic growth and employment. This has made economic and social development more dynamic.
Adhering to and improving the basic economic system whereby public ownership is dominant and other forms of ownership develop side by side is vital for consolidating and developing the socialist system with Chinese characteristics.
On one hand, China must remain firmly committed to strengthening and developing the public sector, maintaining its position as the major player, allowing the state-owned sector play a leading role, increasing its dynamism, control, and influence.
On the other hand, it must stay focused on encouraging, supporting and guiding the development of the non-public sector, and stimulating its dynamism and creativity.
With regard to the functions of the public and non-public sectors, both are important foundations of China’s economic and social development. With regard to property rights protection, the property rights of the non-public sector are inviolable just as those of the public sector. With regard to policy treatment, China should ensure equal rights, opportunities, and rules for businesses in both sectors, and implement a unified market access system. China should encourage non-public enterprises to contribute to SOE reform, encourage the development of mixed-ownership enterprises in which private capital holds a majority stake, and encourage qualified private companies to establish modern corporate structures.