Xi’s government has announced tariff cuts and
market-opening measures including allowing
full foreign ownership of auto manufacturers
for the first time. But it is resisting pressure
to discard technology development plans
considered to be crucial for prosperity and
global influence.
The World Bank report calls on Beijing to
“remove distortions and market barriers” and
to ensure government policies “supplement
market competition instead of supplanting it.”
The government should provide a “clear and
fair business environment” instead of making
commercial decisions, the report said. It calls
for faster action in reforms aimed at making
state-owned companies more competitive
and “greater discipline” in official support to
specific industries.
A survey of 500 entrepreneurs in five Chinese
cities found they believe the most effective
government initiatives improve business
conditions and promote competition rather
provide direct subsidies or official financing, the
report said.