Economic Watch: China's robust business registration indicative of resilient economy

Updated: August 29, 2022 Source: Xinhua News Agency
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BEIJING, Aug. 28 (Xinhua) -- China saw a stable increase in business registration in the first half of this year, which indicates a resilient and vibrant economy despite multiple challenges.

The number of registered market entities totaled 161 million at the end of June, up 4.4 percent from 2021, according to the State Administration for Market Regulation.

Among all the entities, 50.39 million are businesses and 107.94 million are self-employed individuals. In the January-June period, the number of newly-added market entities stood at 14.54 million, up 4.3 percent year on year.

The promising figures represented a hard-won achievement, as the macroeconomy suffered from unexpected impact in the second quarter partly due to COVID-19 flare-ups at home and global volatility.

Thanks to decisive, timely pro-growth measures, major economic indicators returned to growth in June and maintained the recovery trend last month, albeit with mild fluctuations. Meanwhile, new business registration growth, which softened in April, also regained momentum in May and saw a surge of 19.7 percent in June.

"If comparing social and economic development to a towering tree, then supporting market entities is to improve the soil underneath," said Gao Peiyong, vice president of the Chinese Academy of Social Sciences.

According to data, the country's 161 million registered market entities create jobs for nearly 300 million people. Market entities established after 2013 paid 4.76 trillion yuan (about 695 billion U.S. dollars) of taxes last year.

China has unwaveringly supported the healthy growth of businesses. At present, as the economy is in a critical stage of stabilization, helping struggling businesses is high on the agenda of policymakers.

Premier Li Keqiang highlighted the significance of market entities to the stability of the economy and employment at a teleconference with senior officials from six major economic provinces earlier this month.

Noting that the six provinces boast over 40 percent of China's market entities, which offer more than 40 percent of the country's job opportunities, he stressed efforts to step up support for enterprises to tide over difficulties and resume vitality.

The State Council rolled out a raft of policies at its executive meeting on Aug. 24. New favorable measures include support for private businesses and the platform economy, deferment of payments of government-levied charges, and risk compensation funds for loans to small firms and the self-employed.

Moreover, this year China implemented a large-scale initiative of value-added tax credit refund, which in volume surpassed that of the previous three years combined. The total tax refunds amounted to about 2.14 trillion yuan by mid-August.

"Tax refund of 3.93 million yuan transferred to our bank account helped us endure the most difficult days," said Zheng Jun, general manager of a medical waste disposal company in Shijiazhuang, north China's Hebei Province. With the much-needed money, the company was able to complete its equipment upgrade smoothly.

Analysts said the favorable policy increased the cash flow of enterprises and played an important role in stimulating market vitality.

The robust business registration has also helped advance the country's high-quality development.

In the first half, the growth rate of new economy market entities stood well above the average. More than half of the newly-added firms were related to new technologies, new industries and new business models.

Editor: Duan Jing