Economic policy: worries in China: Law is intended to promote private companies

In the ongoing trade dispute with the USA and in the face of constant economic worries, China wants to promote his private sector by law. As the state news agency Xinhua reported, the constant committee of the National People’s Congress voted for the 78 articles comprehensive. This should therefore come into force on May 20.

The long -awaited law is intended to enable private companies to compete with state companies, facilitate market access and to maintain economic rights and interests. German and European companies in China have long been complaining of unfair conditions in public tenders. As a result, private investments have dropped in recent years.

Beijing wants to create trust with the law. The second largest economy in the world struggles with a weak demand in Germany, the effects of a real estate crisis and international trade disputes. The export nation is therefore looking for paths to achieve the self -set growth target of around five percent this year. More consumption is considered a solution.

However, private companies should be excited to see how consistently China’s local governments will enforce the new regulations. In a contribution in the “Volkszeitung”, a mouthpiece of the Communist Party, economic expert Li Zhaoqian demanded that the standards “reliably” implement. It must also be considered that the private sector, for example, is faced with many problems through “external circumstances” and a “change in demand”.

Problem trade conflict with the USA

China’s economy is under pressure because of the trade conflict with the USA. US President Donald Trump imposed on Chinese goods up to 145 percent, which hits many private companies. According to Xinhua, the private sector accounts for more than 60 percent of China’s economic output and employs 80 percent of workers in the cities.