Private firms need support, understanding (China Daily) Updated: 2004-03-10 00:38
Both China's top legislators and advisers appealed
to the public Tuesday to cut private businesses and the rich some slack while
calling for a sound institutional environment for the development of the private
sector.
Li Yining, honorary vice-chairman of the China Democratic League (CDL) and
vice-chairman of the Economic Committee of the Chinese People's Political
Consultative Conference (CPPCC), said Tuesday that private businesses are
playing an increasingly important role in creating jobs and driving the economy
forward.
"Some people become rich first and then they can help others get rich," said
Li, criticizing the belief that rich people make others poor.
By the end of November 2003, the number of China's private enterprises was
2.97 million with a registered capital exceeding 334.7 billion yuan (US$40.5
billion). The private sector contributes to half of China's national economic
growth.
In Beijing, for example, private business provides more than 4.17 million
jobs or 61.2 per cent of the total.
During the on-going annual session of the 10th National Committee of the
CPPCC, another debate on the so-called "original sin" of private enterprises
aroused the top advisers' concern.
An official document in North China's Hebei Province released earlier this
year says authorities should not prosecute bosses of private firms if crimes
committed in the initial stages of business development exceed the statute of
limitation stipulated in the Criminal Code.
"Original sin" here is linked to the private sector, referring to crimes and
irregularities committed by private entrepreneurs during the initial development
of their businesses in 1980s and includes tax evasion, bribery, illegal
money-raising and making shoddy products.
"The document is a positive gesture," said Liu Jiachen, a member of 10th
National Committee of the CPPCC, adding that the document aims to remind
relevant departments of the stipulation in the Criminal Code.
Liu said that according to Chinese criminal law "authorities cannot prosecute
anyone if their crime has outlived the validity period."
"And it is, of course, applicable to private entrepreneurs," he said. The law
says the statute of limitation for crimes carrying a maximum penalty of no more
than five years' imprisonment is five years; 10 years for crimes that attract
imprisonment of more than five years but less than 10; and 15 years for crimes
carrying a maximum penalty of 10 years or more. If the maximum punishment for a
crime is life imprisonment or death penalty, the statute of limitation is 20
years; after 20 years, prosecutors must get approval from the country's top
prosecutors' office. Liu said that if private entrepreneurs are investigated
even if their irregularities exceeded the statute of limitation, stiff actions
will do society no good since many private companies have grown large, hired
many employees and contributed greatly to the country.
However, Liu said that only law-abiding private enterprise can make long-term
profit.
Top legislators and advisers, meanwhile, vowed to shake off obstacles in
market access and financing as well as heavy tax burdens in the development of
the private sector of the economy.
Wang Yiming, member of the Standing Committee of the National People's
Congress, China's top legislative body, said many Chinese private entrepreneurs
are most concerned with the lack of a transparent schedule industries barred
from private investment, such as civil aviation and oil.
Wang, also vice-chairman of the All-China Federation of Industry and
Commerce, said a muddy attitude by the government will add to private
enterprises' costs for development. For example, related government departments
recently approved the establishment of the country's first private civil
aviation company in the vacuum of the opening-up policy of the industry.
"Will there be green light for others waiting in the queue? No one knows," he
said.
Yin Mingshan, a member of the 10th National Committee of CPPCC, said the
biggest difficulty for the private sector is capital expansion.
It was reported that there is some 20,000 billion yuan of non-governmental
capital lying idle, failing to find its way into investment areas.
Most financial complaints, Wang said, can be relieved through the
establishment of effective risk evaluating and credit recording systems.
In addition, Li Yining suggested encouraging the development of small private
banks that will cover areas beyond the means of State-owned commercial banks and
accelerate the construction of a capital market, including the growth board
market for some small and middle-sized private enterprises.
