Move to help shore up both domestic and foreign businesses, experts say

China will take a slew of steps to expedite the building of a unified domestic market that is efficient, rules-based and open, and that encourages fair competition amid growing complexities and uncertainties in the international landscape.

Experts said the move will break down walls, foster a more enabling business climate and bring out the vitality of market players, which will shore up the sound and sustainable development of domestic as well as foreign businesses.

According to the decisions made at the State Council executive meeting chaired by Premier Li Qiang on Friday, China will explore an overall work plan on building a unified domestic market and take a raft of new policy measures toward the goal.

The attendees decided to launch targeted rectification campaigns to address pressing concerns such as local protectionism and market fragmentation in key areas. Sustained work will be done to deliver concrete benefits on the ground.

They called for greater efforts to deepen the reform. Further measures will be employed to optimize fundamental systems of the market economy, including protection of property rights, market access, fair competition and social credit, and to improve the incentive, constraint and evaluation mechanisms.

Bai Ming, deputy director of international market research at the Chinese Academy of International Trade and Economic Cooperation, said the interregional barriers within China's domestic market must be abolished to usher in greater openness and inclusiveness.

Through the removal of local protectionism and sector monopolies and the implementation of standards and regulations that are applicable nationwide, the move will facilitate the circulation of capital, factors of production and commodities among regions in a way that largely reduces transaction costs and improves the operational efficiency of China's markets, Bai said.

Despite its emphasis on the domestic market, the move will also act as a key tool to advance a broader agenda of opening up across more areas and in greater depth instead of creating closed and exclusive circles, he said.

By providing a benchmark based on advanced international rules and best practices, the construction of a unified domestic market will enhance the connectivity between domestic and international markets and clean up policies that put foreign companies at disadvantage, enabling both domestic and foreign businesses to thrive on a level playing field, he said.

The meeting urged localities to fulfill their due responsibilities with the bigger picture in mind, and take resolute steps to break a conservative mindset and guard against a silo mentality.

Such efforts will fully leverage the country's edge of being a broad-based economy, make resource allocation more effective, further tap into market potential, better harness advanced resources worldwide, and provide a strong base for fostering a new development paradigm and pursuing high-quality development, according to the meeting.

Xu Hongcai, deputy director of the China Association of Policy Science's Economic Policy Committee, said the building of a unified domestic market will make China even more open, transparent and predictable for galvanizing greater private and foreign investment.

The coordination and unification of standards, rules and policies across regions and industries will make it easier for market players of all types to enter and expand operations throughout China because they won't have to navigate multiple, different sets of standards, he said.

It will keep entrepreneurs at home and abroad fully motivated in order to leverage all kinds of resources to the extent possible and spur technological innovation, he added.