Guiding Opinions of the General Office of the State Council on Further Stimulating Effective Private Investment Vitality and Promoting Sustained and Healthy Development of Economy

Guo Ban Fa [2017] No.79

People's governments of all provinces, autonomous regions and municipalities, ministries and commissions and institutions directly under the State Council,

The CPC Central Committee and the State Council attach great importance to private investment. In recent years, a series of targeted policies and measures have been deployed, and special inspections were carried out, and the growth rate of private investment has been stabilized and rebounded. However, at present, the growth of private investment still faces many difficulties and obstacles. Some policies to encourage private investment have not been put in place, the business environment needs to be further improved, the market openness of some monopoly industries is not enough, the financing difficulties and expensive financing problems still exist, and the situation that private investment is not vigorous has not been fundamentally changed. In order to further stimulate effective private investment vitality and promote sustained and healthy economic development, with the consent of the State Council, the following opinions are brought forward. 

I. Deepen reforms to "streamline administration, delegate power, improve regulation and upgrade services", and constantly optimize the business environment

All regions and government departments shall thoroughly implement the requirements of the State Council on deepening reforms to "streamline administration, delegate power, improve regulation and upgrade services", and ensure that key tasks are fully implemented such as abolishing or delegating the administrative licensing matters by the State Council departments, canceling administrative examination and approval matters designated by the central government and implemented by local governments, and cleaning up the administrative examination and approval intermediary services by departments of the State Council; resolutely implement relevant requirements on cleaning up and standardizing investment projects application and approval process, streamline and merge investment project approval matters, no administrative examination and approval matters shall be arbitrarily increased and no approval process shall be arbitrarily prolonged; effectively prevent the return of the power and increase of administrative examination and approval matters while trying to reduce them; give full play to the national online platform for the approval and regulation of investment projects, achieve goals that project applications are filled online and are examined and approved jointly, project information is disclosed and projects are supervised collaboratively, and constantly improve the efficiency of approval and quality of service.

II. Carry out thorough inspections to grasp the situation of private investment projects applying for examination and approval, improve the level of approval services

All regions and all government departments shall carry out a comprehensive and detailed clean-up inspection on the approval of private investment projects, tease out private investment projects that have been submitted for examination and approval, check the handling of various types of examination and approval matters, and set clear time limits for handling. Projects that can be approved shall be handled as soon as possible. For projects that still do not meet requirements, it is necessary to help private enterprises realize relevant conditions as soon as possible. For projects that cannot be approved according to the law, it is necessary to take the initiative to explain why. For those who delay or fail to implement without justified reasons, we shall strengthen accountability, urge rectification within a limited period of time through interviews, notifications, and supervision, and, if necessary, relevant responsible persons shall be punished. In view of the problems found in the clean-up inspection, we shall further improve our work, increase efficiency, and optimize the examination and approval services for private investment projects.

III. Promote industrial transformation and upgrading, support the innovation and development of private investment

We will encourage private enterprises to enter rail transport equipment, "Internet +", big data, industrial robots and other fields that have long industrial chain and prominent driving effects, and actively attract private enterprises to participate in the establishment of the "Made in China 2025" national demonstration zone; give full play to the leading role of financial funds, absorb a wide range of social capital extensively through investment subsidies, capital injection, establishment of funds and other means to support enterprises to intensify technological transformation, and  increase input to integrated circuits and other key areas and key projects of weak links; support the construction of public service platforms at mass entrepreneurship and innovation demonstration bases and industrial parks, and improve services capacity and level for private enterprises investing in emerging industries; promote innovative technology market transactions, shorten the transformation cycle of scientific and technological achievements, and improve the level of return on investment by scientific and technological enterprises; encourage private capital to carry out diversified agricultural investment, support the development of new industries and new commercial activities in rural areas, promote  private capital to establish joint-stock cooperation and other interest closely linked mechanisms with farmers, and increase support to market players who have done a lot to help farmers.

IV. Encourage private capital to participate in  Public-Private Partnership (PPP) projects, promote the construction of infrastructure and public utilities

We will increase the openness of infrastructure and public utilities, prohibit any exclusion, restriction or discrimination against private capital, create equal opportunities for private enterprises, support social capital with a high proportion of private capital equity to participate in PPP projects, and mobilize the enthusiasm of private capital; actively adopt a variety of PPP operation modes, activate inventory assets in a standardized and orderly way, enrich investment opportunities for private enterprises, and use funds reclaimed mainly on project construction in weak links to form new high-quality assets so as to achieve a virtuous cycle of investment; determine reasonable prices and charges to infrastructure and public utilities, improve the price and charge timely adjustment mechanism for PPP projects, and establish a reasonable return mechanism for PPP project to attract private capital by appropriately extending the duration of cooperation, actively innovating the business model and fully tapping the commercial value of the project. Efforts shall be made to improve the financing capacity of private enterprises, effectively reduce financing costs, promote securitization of PPP project assets, and encourage private capital to participate in the investment of large-scale PPP projects by taking mixed ownership, establishing funds, forming unions and other ways.

V. Reduce the operating cost of enterprises, enhance the driving force of private investment

We will implement and improve the pilot policy to comprehensively replace business tax with value added tax, fully implement the policy of pre-tax weighted deduction of R&D costs, and strengthen the supervision and management of service fees related to enterprise business operation and intermediary services. Regions where the allowable total rate of unemployment insurance is 1.5% shall reduce this rate to 1% by stages. We will implement the policies to appropriately reduce proportion of housing provident fund, promote the introduction or improvement of household registration policies and supporting measures; deepen the power transmission and distribution price reform, promote electricity market transactions, adopt industrial land flexible transfer system, and make good and full use of standard plant and technology incubator land support policies to reduce the cost of land use for enterprises; determine vehicle tolls scientifically and reasonably, standardize railway and port charges, carry out special inspections in the field of logistics, spare no effort to solve the "arbitrary charges, arbitrary fines" and other issues; urge the banking and financial institutions to collect fees according to law, reduce the cost for obtaining loans, strictly prohibit all kinds of unjustified fees and unreasonable loan attached conditions.

VI. Try every effort to crack financing difficulties, provide diversified financing services for the private capital

We will take full advantage of various financial institutions, optimize the credit management and service processes, improve the confirmation, registration, mortgage, circulation and other supporting system for franchise rights, right of charge and other rights, develop and enrich revolving loans and other financial products, speed up the construction of inclusive finance system, carry out small and micro-enterprise accounts receivable financing special action, spare no efforts to solve the problems of recalling loans ahead of time, delaying in issuing loans, and stop providing loans faced with enterprise; improve the private enterprise credit rating system, evaluate the strength of private enterprises objectively, and guide financial institutions to increase financing support for private enterprises; give full play to the role of government websites of all levels and the national credit information sharing platform, encourage local governments to promote the "bank-tax interaction" and cooperation between banking financial institutions and the national credit information sharing platform, resolve the problem of information asymmetry between banks and enterprises, and enhance small and medium enterprises financing ability; develop government-backed financing guarantee and re-guarantee institutions, encourage the establishment of credit risk compensation funds and capital pools for bridge loans and relending, increase support to small and medium enterprises and scientific and technological innovation enterprises.

VII. Strengthen the building of government integrity, ensure the implementation of agreements by governments

Local governments at all levels shall make policy commitments to private enterprises strictly in accordance with the law, and strictly fulfill the legal policy commitments. No preferential conditions shall be committed violating laws and rules. Legal agreement or contract signed with the private enterprises shall be fulfilled strictly and shall not be refused to implement at the excuse of leadership transition or replacement of relevant responsible person. Arbitrary changes to agreements will not be allowed, and the situation that "new officials ignore the old debts" shall not happen. We shall carry out special actions to deal with government dishonesty, and intensify investigation and penalties to local governments that are found to refuse to fulfill the legitimate commitments, in particular, seriously damage legitimate rights and interests of private enterprises, destroying a good environment for private investment. The main person in charge and the person directly responsible for causing serious breach of contract by the government shall be held accountable according to law and disciplined directly.

VIII. Strengthen policy coordination, stabilize market expectations and investment confidence

We will strengthen the coordination between departments, study the expected effect of the proposed policy and market response scientifically and prudently, and grasp the timing and intensity for the introduction of policies. Relevant departments shall define policy guidance while strengthening supervision, put forward specific requirements in line with laws and regulations and correctly guide investment expectations. We shall intensify policy interpretation around the situation of economic operation and macroeconomic policy orientation, take the initiative to solve doubts and help private enterprises to accurately understand the intention of the policy; establish and improve public opinion collection, study, disposal and response mechanism, release of authoritative information timely and accurately, respond to private enterprises’ concerns in a down-to earth manner; improve fair, open and transparent market rules, stabilize market expectations, enhance market vitality, help private enterprises to make full use of the large domestic market and increase investments adapting to the needs of domestic consumption upgrading and industrial transformation, support gradient transfer of labor-intensive industries to inland and border areas.

IX. Build new “close” and “clean” government-business relation, enhance government service awareness and ability

We will establish a sound government-private enterprise normalized communicating mechanism, further take advantage of the bridge role of the Federation of Industry and Commerce, Association, Chamber of Commerce in the communication between enterprises and government, listen to the voice of private enterprises, and help private enterprises to solve practical difficulties; determine the "merit list" and "demerit list" in contacts with enterprises according to local conditions; spare no effort to address the problems of "close" but not "clear" or "clear" but not "close" and so on; resolutely implement the Opinions of CPC Central Committee and State Council on the Improvement of Property Rights Protection, bring forward relevant supporting documents and implementation plans as soon as possible, strengthen protection of property of all kinds of ownership, increase intellectual property protection efforts, and stimulate and protect entrepreneurial spirit; organize and carry out specialized and accurate training for private entrepreneurs to enhance private enterprise management.

X. Take serious measures to ensure that all the policy measures will be implemented and produce the desired results, enhance private enterprises’ sense of acquisition

All regions and all government departments shall thoroughly tease out all policy measures issued by CPC Central Committee and the State Council that are in action aiming at encouraging private investment, check the situation of implementation in local regions and specific fields one by one, and analyze the reasons for the policy measures that have not yet been effectively implemented. We shall find solutions quickly to ensure that the policy will be implemented as soon as possible; give full play to the enthusiasm of central and local governments, encourage local governments to consolidate, refine and deepen each specific measure by reforms with innovative thinking, so as to make every effort to solve the deep-seated problems constraining private investment growth and further stimulate effective private investment vitality.

The people's governments of various provinces, autonomous regions and municipalities and relevant departments shall, in accordance with the requirements of the Opinions, earnestly implement relevant policies and further optimize various tasks relating to private investment. National Development and Reform Commission shall strengthen coordination, carry out supervision and follow-up analysis of the implementation of the Opinions in conjunction with relevant departments, and report to the State Council in a timely manner when major issues arise.

The State Council

September 1, 2017