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More Robust Regulation for Sustainable Development and Growth
--- Signed Article by Chinese Ambassador Chen Xiaodong
2021/08/24

Recently, there have been widespread concerns in South Africa and other countries over China's efforts to strengthen regulation of the platform economy and the tutoring sector. In this regard, I would like to share with you my perspectives.

China's rationalized regulation is essential for more robust anti-monopoly measures. At present, the international community is increasingly concerned about the excessive power and influence of technology giants, which hinders innovation and competition and increases economic inequality. Anti-monopoly regulations globally have thus been strengthened. Ever since this year, the United States and the European Union have introduced a series of antitrust bills and policy documents to enhance antitrust efforts. Anti-monopoly practices also exist in South Africa. The control over data fees and food prices imposed by big corporations here has safeguarded consumers' rights and interests. Monopolistic actions in the platform economy is also a matter of grave concern for the South African Competition Commission. No country can turn a blind eye to the negative externality of the emerging digital economy.

In recent years, China has called for strengthening anti-monopoly on several occasions. The 2020 Central Conference on Work Relating to Economic Affairs identified "strengthening anti-monopoly and preventing disorderly expansion of capital" as one of the eight key tasks for 2021. The 14th Five-Year Plan and Long-Range Objectives Through the Year 2035 also include clauses on several "anti-monopoly" and propose to "increase judicial efforts in anti-monopoly and anti-unfair competition enforcement". Recently, the ninth meeting of the Central Finance and Economics Commission stressed that it is important to balance development and regulation, better coordinate development and security as well as domestic and international dynamics, promote fair competition, oppose monopoly, and prevent the disorderly expansion of capital.

The platform economy is the new driving force of China's economic development. The ultimate purpose of regulation enforcement is to further stimulate innovation and development vitality of platform companies, and to pave the way for the platform economy to develop in a law-abiding, innovative, sustainable, healthy and high-quality manner. A series of policies to this purpose have already had a positive impact, with two Chinese giants, Alibaba and Tencent, reaching out to and cooperating with each other to serve the consumers more effectively.

China's enhanced regulation aims to enable development achievements to benefit all people. General Secretary Xi Jinping has repeatedly stressed the need to adhere to a people-centered development philosophy and promote common prosperity through high-quality development. The people-centered philosophy is the underpinning of the CPC, a Party that serves the people, not capital, and a Party that represents the fundamental interests of the overwhelming majority of the people, not any interest group. We have always been committed to promoting people's well-being. We believe that development is for the people, development relies on the people, and the benefits must be shared by the people. As China continues to improve its regulatory mechanisms, we bear in mind that the law-abiding and healthy development of industries, network data security and people's livelihoods. Take the education sector as an example, we put in concrete measures to reduce homework and off-campus tutoring for students in compulsory education. We regulate off-campus tutoring institutions according to law, and work to prevent this industry that's designed to benefit students from excessive profit-seeking. These measures are fundamental for education. They are important initiatives conducive to safeguarding people's livelihood and promoting long-term economic and social development.

China's strengthening of regulation helps promote sustainable science and technology innovation. The current global economic and financial situation is going through profound changes. The pandemic has accelerated the birth of new technologies, industries as well as new forms and models of business. Scientific and technological innovation has become the main driver of the high-quality development of the global economy against the back drop of the COVID-19 pandemic. Proper regulation can help promote the sustainable application of innovations. China adheres to the new development philosophy throughout the development process and in all fields. We focus on improving quality, efficiency and adapting to new driving forces. We promote healthy and vigorous development of the high-tech industry by strengthening effective regulation and guidance for technology companies.

Facts speak louder than words. In 2020, the number of China's digital platform enterprises worth more than USD 1 billion reached 197. Also, the digital economy totaled around USD 6 trillion for the year. In the first half of this year, the added value of China's high-tech manufacturing industry rose by 22.6% year-on-year, and investments in high-tech industries increased by 23.5% year-on-year. The output of such industries as new energy vehicles, industrial robots and integrated circuits grew by 205%, 69.8% and 48.1% year-on-year respectively. The number of new market entities exceeded 30 million for the first time. China's innovation-driven development has gained strong momentum, with the successful landing of the Tianwen 1 probe on Mars, the successful launch and docking of the core module of the Tianhe space station, the Tianzhou 2 cargo spacecraft, the Shenzhou-12 manned spacecraft, and the commercial operation of the Hualong-1 third-generation autonomous nuclear power plant. All these achievements demonstrate that the Chinese economy will continue to see more innovation-based growth.

China's high-quality economic development brings greater opportunities for Africa's development. In the first half of this year, China's foreign trade volume grew by a record high ratio of 27.1%. The actual usage of foreign investment grew at a rate unseen in the past decade. The number of large projects with new or additional contracted foreign investment of more than USD 100 million amounted to 602, up by 81.3% year-on-year. The June issue of Global Economic Prospects by the World Bank predicts that China will be the major economy with the highest year-on-year growth rate in 2021. China's contribution to global growth is expected to exceed 25%. These figures show that China remains highly attractive for foreign investment, and foreign investors have greater confidence in the Chinese economy and market.

Under the current situation, The trade activity between China, Africa and South Africa have also picked up steam despite the pandemic and the global recession, demonstrating stronger resilience. From January to July this year, the total trade volume between China and Africa reached USD 139.1 billion, up 40.5% year-on-year, of which China's total imports from Africa reached USD 59.26 billion, up 46.3% year-on-year. The bilateral trade between China and South Africa accounted for more than one-fifth of the total between China and Africa, totaling USD 30.03 billion, up 70% year-on-year. China imported USD 18.84 billion from South China, up 84.6% year-on-year. And China's current cumulative investment in South Africa has exceeded USD 25 billion, creating more than 400,000 jobs directly and indirectly in the region and making significant contributions to the economic and social development of South Africa.

Naspers, together with this portfolio on the Chinese market has been growing and making achievements alongside Tencent. Its success story is an epitome of foreign investment in China. China has never wavered in its drive to further open to the outside world and to further improve its domestic business environment. Time will tell that China's economy will develop more steadily with the rationalized regulations, that China's innovation will unleash greater vitality, that China's economic development will have enormous good prospects, and that it will certainly make greater contributions to global economic recovery and shared development, including to that of South Africa and other African countries.

https://www.businesslive.co.za/bd/opinion/2021-08-23-more-robust-regulation-is-needed-against-tech-multinationals/

 

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