Boosting private enterprises: A competitive and supportive ecosystem

China will unswervingly encourage, support, and guide the development of the non-public sector, according to the "Resolution" of the Third Plenary Session of the 20th Central Committee of the Party.

The Chinese government will help foster a favorable environment and create more opportunities for the development of the non-public sector. It will also ensure that economic entities under all forms of ownership have equal access to factors of production in accordance with the law, compete in the market on an equal footing, and are protected by the law as equals.

What does this mean for private enterprises? How do Shanghai's entrepreneurial spirits help create a favorable environment for business?

Shanghai Daily talks with Professor Song Hong at School of Economics of Fudan University, to shed light on these questions.

Shanghai Daily: The Third Plenary Session of the 20th Central Committee proposed to help foster a favorable environment and create more opportunities for the development of the non-public sector. What does this mean for private enterprises in Shanghai?

Song: As mentioned in the "Resolution", China will promote the fair opening of the competitive field of infrastructure to business entities, and support capable private enterprises to take the lead in undertaking major national technological research tasks.

This policy orientation will bring a more fair, transparent, and predictable business environment for private enterprises in Shanghai, help stimulate the vitality and creativity of enterprises, and promote their faster and better development.

Shanghai Daily: How should Shanghai use this opportunity to develop its non-public sector?

Song: Shanghai should make full use of this policy opportunity to improve financing support policies, strengthen talent training and introduction, optimize the business environment, and promote private enterprises to achieve higher-quality development.

For example, through policy guidance and financial support, private enterprises are encouraged to increase investment in research and development, to break through key core technologies, and to enhance industrial core competitiveness.

In addition, Shanghai should actively promote cooperation and exchanges between private enterprises and universities, and establish an innovation system with deep integration of industry, university, and research. Through cooperation with universities and scientific research institutions to cultivate high-level talents, and provide a strong talent guarantee for private enterprises to participate in major national technological research.

Shanghai Daily: What measures has Shanghai already taken to attract and support private enterprises? What achievements has it made?

Song: Shanghai continues to improve the business environment and has introduced a series of supportive policies for private enterprises, for example, tax incentives, financial subsidies, financing support, to reduce the burden on enterprises.

In the first half of this year, private enterprises continued their increasing trend. The import and export volume of private enterprises in Shanghai was around 660 billion yuan, increasing by 3.2%.

Shanghai Daily: What are the distinctive qualities of Shanghai's entrepreneurial spirit?

Song: I think the first is openness and inclusiveness. Shanghai has always been China's window of openness, and this historical background has endowed Shanghai entrepreneurs with an innate open-mindedness. They are willing to accept new things, new technologies, and new concepts. And they actively participate in the international market and seek opportunities for cooperation and development.

Such inclusiveness displayed by Shanghai entrepreneurs is a reflection of the city's diverse cultural fusion. Shanghai respects talents of different backgrounds and cultures and encourages innovative thinking and diverse development. This inclusiveness not only promotes harmony and creativity within enterprises but also creates a favorable business environment in Shanghai and the entire Jiangsu-Zhejiang region, attracting numerous domestic and foreign excellent enterprises and talents to invest and start businesses.

Second, diligence and dedication. Shanghai entrepreneurs are practical, hardworking, and pursue a stable and long-term business style. It is this diligence and meticulous management style that has earned Shanghai enterprises a good reputation and credibility in the market.

Shanghai has attracted a lot of foreign investments. For example, in May 2024, Tesla's energy storage super factory officially started construction in Lingang, Shanghai. This is Tesla's first energy storage super factory outside the US.

Tesla came to Shanghai in 2013. Back then, the Tesla team in China had only about a dozen people and then most Chinese consumers were not familiar with the pure electric vehicles. But now, both the "factory" and the "market" in China hold extremely important positions in Tesla's global layout. In 2023, Tesla sold 600,000 cars in China, which was about one-third of Tesla's global sales. Through this kind of cooperation, Tesla and Shanghai have achieved a win-win result.

Shanghai Daily: What advantages does Shanghai have in attracting and training labor for its private sector?

Song: First in the market openness. Shanghai has a high degree of market openness, attracting a large number of domestic and foreign enterprises and investors.

Second is a diversified industrial structure. Shanghai's industrial structure is diversified, covering financial, technology, manufacturing, and service sectors. This diversified industrial structure provides rich investment opportunities and development space for private enterprises, helping them achieve diversified operations and upgrading.

The third is quality educational resources. Shanghai has many well-known universities that provide rich human resources and intellectual support to private enterprises.

Shanghai Daily: How do you think these educational resources can be better matched with the needs of private enterprises to cultivate talents that meet market demands?

Song: There are a total of 69 colleges in Shanghai. To effectively connect these resources with the needs of private enterprises, it requires joint efforts and cooperation from the government, universities, and enterprises.

First, in terms of collaborative research, universities and enterprises cooperate to build research platforms and technological innovation centers, and jointly conduct research projects and technological breakthroughs.

Second, Shanghai's universities constantly adjust and optimize their major and course settings based on market demand and the trend of industrial development. For example, new majors and courses related to artificial intelligence and big data are added to meet the needs of emerging industries.

There have been many practical examples, such as strategic cooperation agreements signed between top universities such as Fudan University and Shanghai Jiao Tong University and well-known enterprises such as Huawei and Alibaba, jointly carrying out talent training and scientific research cooperation projects.