CRI听力: Doors Open Wider for Private Enterprises

According to China's State Council, the country will step up efforts to open up industrial fields controlled by state-owned enterprises to private sectors. This has provoked excitement among private entrepreneurs in China.

Let's take a look with reporter Liu Min.

According to a statement released by the State Council, the government will further encourage private investment in sectors currently controlled mainly by state-owned companies, such as energy, public utilities, telecommunications, transport infrastructure, and the building of affordable housing.

Zhou Dewen is the Chairman of the Wenzhou Medium and Small enterprise Development Association. He says this could be a valuable development opportunity for private enterprises.

"This is great news for private capital, especially for Wenzhou's private sector. Such policies can better guide us to invest in the right direction. We were quite lost last year since we had more than five trillion yuan of capital in banks here in Wenzhou without appropriate investment channels for it."

Just twenty-five years ago, private entrepreneurs in China were mostly hawkers peddling their wares on foot or from tricycles in the cities' back streets. But now they are a recognized tribe, freely roaming the nation's vast economic landscape.

In 2008, the private sector accounted for more than 50 percent of the whole nation's GDP, providing more than 70 percent of jobs to the country. Private medium and small sized enterprises owned two thirds of patents, developed about three quarters of innovative technology, and rolled out over 80 percent of new products.

At a fast developing pace, a large amount of capital has been accumulated by these enterprises. Wenzhou is such a city, where lots of private enterprises are booming, but now it is also know as home of property speculators in China. Entrepreneurs like Zhou Dewen says private capitals were actually blocked outside the gate of those monopolized industries.

"The private capital here has long been trying to enter investment areas like finance, insurance, infrastructure, electricity and telecommunications etc. However, till now, it's been very difficult."

In order to better direct free capital, in 2005, the State Council publicized a series of policies encouraging the private sector to join industries mainly occupied by state-owned enterprises. However, the thresholds were too high for the private sector to enter.

Economist Tang Min from the China Development Foundation says to change the situation, the implementation of the policy is very critical.

"From the previous experiences, we know that some of the policies were not put through eventually. It's mainly due to the prejudice towards the private investment from some government departments."

Private enterprises have made a great contribution to the Chinese economy. The state council says the government will create a better environment for private investment by setting up a sound administrative service system and amend unfavorable laws and regulations. Entrepreneurs like Zhou Dewen hope this time the government can push the plan with more efforts and at a quicker pace.

For China Drive, I'm Liu Min.