China's Measures To Entice Businessmen Have Opposite Effect

After years of regulatory crackdowns and draconian COVID curbs, private entrepreneurs in China are low on enthusiasm.

Photo Insert: Rather than assuaging worries among entrepreneurs and encouraging them to create jobs and economic growth, the statement — in which the most controversial promises were later deleted — could have the opposite effect.

The Chinese government is resorting to surprising measures to restore their confidence, but the campaign has inspired more nervousness than optimism, Laura He reported for CNN.

Hainan, an island that Beijing plans to turn into the world’s largest free trade port, rolled out a package of initiatives last month intended to support the private sector. The most eyebrow-raising was a pledge from the government not to target private businesspeople without cause.

“For those entrepreneurs involved in criminal cases, [authorities] should not arrest them if it’s not necessary, should not prosecute them if it’s not necessary, should not give them jail terms if it’s not necessary,” it said.

“If it’s also not needed to continue to detain them, [authorities] should release them in a timely manner or change enforcement measures [against them].”

“The Chinese government is trying to turn Hainan Island into a fully ‘open’ zone,” said Willy Lam, a senior fellow at the Jamestown Foundation, a Washington-based think-tank. “However, the statement by Hainan authorities underscores the arbitrary nature of Chinese laws even regarding multi-million-yuan private bosses.”

The package contains more than two dozen measures to support private industry, which accounts for more than 60% of China’s GDP and over 80% of employment.

The Hainan government said the measures were aimed at protecting the legitimate rights and interests of private entrepreneurs and creating a “fair and just” legal environment.

Instead, the announcement caused great controversy online and offline. Some people criticized the move as “absurd” on social media, as it implied the government had been arresting people at will and that entrepreneurs could now enjoy extrajudicial rights.

Rather than assuaging worries among entrepreneurs and encouraging them to create jobs and economic growth, the statement — in which the most controversial promises were later deleted — could have the opposite effect, according to analysts. It may cause even more anxiety among businesspeople about arbitrary punishment.

WEEKLY FEATURE : MVP Group Keeps Lights On During Pandemic