Economic Watch: China's unified market a vital boost for economic circulation-Xinhua

Economic Watch: China's unified market a vital boost for economic circulation

Source: Xinhua

Editor: huaxia

2022-05-17 15:16:26

BEIJING, May 17 (Xinhua) -- China's new economic development pattern of "dual circulation" is set to get a vital boost as authorities detailed an ambitious plan on how to build a national unified market to enable a more efficient and smooth flow of labor and goods across the country.

Eyeing a comprehensive push for the country's market to evolve from being big to becoming powerful, authorities last month issued a guideline on accelerating the establishment of a unified domestic market that is efficient, rules-based, fair and open.

The aim is to remove local protectionism, market segmentation and impediments restricting economic circulation to facilitate the smooth flow of products and resources on a larger scale, according to the guideline.

The concept of a unified market is not new in China. Back in 2013, several government agencies jointly released a work plan on the removal of regional blockades across the country to build a unified and open market system, and gradual steps have been taken toward achieving the goal.

The task gained more urgency since authorities in 2020 floated the dual circulation policy, which takes the domestic market as the mainstay while letting internal and external markets boost each other, as a strategic solution to build up resilience against external shocks.

To make the domestic market function more efficiently, the coordination and unification of standards, rules and policies in different regions and industries will be the necessary foundation.

"The key to building a new development pattern lies in the unobstructed economic cycle, which requires accelerating the construction of a unified national market as a scattered and fragmented market cannot guarantee the free flow of factors, as well as the fair distribution and smooth circulation of products," said Liu Zhicheng, with the Chinese Academy of Macroeconomic Research, a think tank under the National Development and Reform Commission.

Although decades of market-oriented reforms have made circulations of goods and services more smooth, local protectionism and market segmentation remained a major hindrance to fostering a unified market.

The guideline specified a wide range of standardizations, including the unity of basic market institutions in property rights protection, market entry, fair competition and social credit.

Seen either in its basic concept, principles, targets, or policy measures, the building of a unified market is consistent with the country's market-oriented reforms, Liu noted, dismissing concerns that the country may return to the path of a planned economy.

As for the impacts on the global market, Liu said the construction of a unified national market does not mean self-imposed closures or closing doors, but it implies advancing institutional opening-ups instead to make better use of global factors and resources.

Adhering to open thinking, the guideline focuses on cultivating new advantages in international competition and cooperation, promoting better connectivity between the domestic market and the international market in terms of market rules and infrastructure, and enhancing influence in the global industry chain as well as supply chain and innovation chain.

Once the task is completed, the relatively unified domestic rules can be better aligned with international rules, and China's mega-market advantages can be utilized more extensively, thus accelerating the construction of a new development pattern of dual circulation, analysts said.