The Significance of Developing New Institutions for a Higher-Standard Open Economy

An important component of building a high-standard socialist market economy

One important goal of our effort to improve the socialist market economy is to ensure that economic entities under all forms of ownership have equal access to factors of production in accordance with the law, compete in the market on an equal footing, and are protected by the law as equals.

By developing new institutions for a higher-standard open economy, China can draw on prevailing international rules to promote the improvement of legal systems in areas such as property rights protection, market access, fair competition, and social credit.

It can also develop institutions and systems that will enable full, effective, and fair competition between various types of business entities, freer and more orderly flow of goods and production factors, and the development of a business environment that is market-oriented, law-based, and internationalized. All this will provide important support for our efforts to build a high-standard socialist market economy that is well-defined, systematic, and complete in nature.

An intrinsic requirement for high-quality economic development

Having transitioned from a phase of high-speed growth to one focused on high-quality development, China now finds itself in a critical period for transforming its growth model, optimizing the economic structure, and making the change to new growth drivers. This all-encompassing historic shift is raising the bar for our opening up approach, model, and planning.

By developing new institutions for a higher-standard open economy, we will be able to pursue a broader agenda of opening up across more areas and in greater depth. We will be able to more effectively bring in advanced foreign technologies, talent, and managerial expertise, optimize the allocation of resources and production factors on a broader scale, and accelerate the development of new quality productive forces and a modern industrial system. All of this promises to generate powerful momentum for high-quality development.

A necessity for creating a new development dynamic

Given our deep integration with the world economy, it is inevitable that China's domestic economy will be affected by changes in the international environment. It is, therefore, vital to promote positive interplay between domestic and international flow by boosting the dynamism and reliability of the domestic economy and engaging in the global economy at a higher level.

By developing new institutions for a higher-standard open economy, we can ensure mutual reinforcement between internal and external opening up and deeper integration between the “bringing in” and “going global” strategies and the domestic and international markets.

This will enable us to further tap the domestic economy, create more opportunities for opening up to the outside world, foster stronger links between domestic and international economies, and make better use of domestic and international markets and resources, all of which will provide more favorable conditions for creating a new development dynamic.

A strategic measure for fostering new advantages in international cooperation and competition

With a new round of technological revolution and industrial transformation well underway, international trade and economic rules are undergoing rapid adjustments, and competition among countries is intensifying in areas relating to markets, resources, talent, technology, and standards.

To develop new institutions for a higher-standard open economy, we need to promote greater opening up with regard to flow of goods, services, capital, and talent and steadily expand institutional opening up in terms of rules, regulations, management, and standards.

This will help raise China’s level of trade and investment cooperation and boost collaboration in new areas, such as the digital economy, green development, and technological innovation.

It will help bolster China's ability to attract global resources and production factors, elevate its position in global industrial, supply, and innovation chains, and provide an important guarantee for the development of new operational and management models for an open economy and new advantages in terms of markets, production factors, and institutions.

A practical step for safeguarding and developing an open world economy

Developing an open world economy is well-aligned with the international division of labor and the trends of economic globalization and global multipolarity. It is an irreversible historical tide.

Our efforts to develop new institutions for a higher-standard open economy constitute an important initiative in China’s pursuit of a mutually beneficial strategy of opening up, which seeks to create new opportunities for the world through China’s development. As such, these efforts will help promote the formation of an open, diverse, and stable world economic order and facilitate strong, sustainable, balanced, and inclusive growth in the global economy.

All this demonstrates how China, as a major country, is committed to coordinating its domestic policies with its international responsibilities and provides a vivid example of how China strives to promote a global community of shared future.

Editor: Zhang Xian