Deepening the Reform and Development of Institutional Mechanisms through Institutional Openness | Economy | Mechanisms

Authors: Chi Fulin, Ma Yu

To achieve a higher level of opening up to the outside world, it is necessary to steadily expand institutional opening up, promote efficient coordination between domestic and foreign systems, rely on the domestic economic circulation system to form a strong gravitational field for global factor resources, deeply integrate opening up and reform, and deepen institutional mechanism reform through institutional opening up.

Promoting Economic Structural Transformation through Institutional Openness

After 45 years of development through reform and opening up, China's economic structure has undergone qualitative changes compared to the beginning of the reform and opening up. In the next 10-15 years, there is still significant room for transformation and upgrading of the economic structure, and there is enormous potential for high-quality development. From the perspective of industrial structure, the proportion of the service industry has rapidly increased. From 2000 to 2019, the average annual growth rate of the added value of the service industry was 15.8%, which is 3.8 times the world average growth rate during the same period, and has become a solid foundation for the development of service trade. From the perspective of consumption structure, the consumption demand of residents is growing rapidly, especially the demand for service consumption, which has become an important driving force for the development of service trade. It is estimated that by 2025, the proportion of service-oriented consumption expenditure by urban and rural residents in China may increase from 43.2% in 2022 to about 50%, which will bring about an additional consumption market of about 10 trillion yuan.

Connecting with high standard international economic and trade rules and promoting institutional openness can help promote economic structural transformation. China's economy has deeply integrated into the world, and many problems faced in economic transformation and development need to be solved under the conditions of further expanding openness. Promoting institutional openness has become an important driving force for promoting economic structural transformation. One is that the development of China's productive service industry still faces shortcomings, and some bottleneck problems mainly exist in the field of productive service industry. This requires further opening up market access in this field, attracting the entry of international high-end factors such as talent, capital, and technology, and quickly filling the gaps in the development of productive service industries. The second is through institutional openness, which can further expand the import of high-quality goods and services, while unleashing huge consumption potential and promoting consumption structure upgrading. Thirdly, expanding institutional openness can promote the construction of a new type of value chain cooperation mechanism, focus on maintaining the global public goods attributes of the industrial chain supply chain, help Chinese enterprises become supporters and maintainers of the global industrial chain supply chain rule system, and participate in, lead and lead the formulation of economic and trade rules such as emerging industry standards, technical standards, product standards, and regulatory standards, and promote the integration of China's industrial chain supply chain planning and mechanism with international standards.

Promoting the construction of a high standard market system through institutional openness

Implementing high-level opening up, especially promoting institutional opening up in terms of rules, regulations, management, standards, etc., is conducive to China's deep integration into the global market system, cultivating new advantages for China's participation in international economic cooperation and competition, and winning the initiative of deep-seated market-oriented reform with openness.

Promoting institutional openness helps to create an international, legal, and convenient business environment. Currently, benchmarking against high standard economic and trade rules such as CPTPP, there is a clear strengthening of institutional arrangements in areas such as fair competition, antitrust, and intellectual property protection, which helps to solidify the basic system of factor markets and create a first-class business environment that is market-oriented, legal, and internationalized. To this end, we should be guided by participating in higher-level international cooperation and competition, and continuously improve the business environment. One is to strengthen the fundamental position of competition policy, treat state-owned enterprises, private enterprises, foreign enterprises and other types of ownership enterprises equally in terms of factor acquisition, access permits, business operations, government procurement, and bidding, promote the transformation of industrial policy, and achieve the transformation of economic policy from industrial policy oriented to competition policy based; The second is to deepen the reform of the investment approval system, optimize government supervision during and after events, strengthen the construction of the market supervision system, and build a scientific and efficient government supervision system; The third is to strengthen the coordination and cooperation of internal and external rules for intellectual property protection, strictly regulate the law enforcement behavior of administrative and law enforcement agencies, strictly protect the rights of entrepreneurs and legal persons to acquire, use, dispose of, inherit and receive compensation when expropriated in accordance with the law, improve the legal system for equal protection of property rights, and stabilize the confidence and expectations of enterprise development.

Promoting institutional openness with a focus on service trade

Service trade is not only an important indicator of high-quality economic development, but also a key factor in promoting the industrial chain and value chain towards the mid to high end. Entering a new stage of development, the opening up of service trade has become the focus, focus, and difficulty of China's high-level opening-up to the outside world. One of the key points in promoting institutional openness is to promote the openness and innovative development of service trade.

The opening up of service trade directly depends on the breakthrough of institutional openness. Service trade mainly refers to the trade behavior of providing services to consumers, which is different from the fact that goods trade relies on opening up at the border. The opening up of service trade directly depends on the degree of international connection with rules, regulations, management, standards, etc. within the border. In the past few years, the development of China's service trade has been directly related to the process of institutional opening up. In 2022, the negative list of market access in China has decreased to 117, of which 83 are in the service industry, accounting for 71%; The negative list of foreign investment access in China has decreased to 31 items, including 23 items in the service industry, accounting for 74%.

Steadily promoting institutional openness will help unleash the enormous potential for the development of service trade. It is expected that by 2030, the proportion of China's service trade volume to the total foreign trade volume will increase from the current 12.5% to around 20%; The proportion of digital trade in service trade will increase to over 60%; The proportion of knowledge intensive service trade in service trade has significantly increased. To meet the objective needs of China's economic structural transformation and upgrading, it is necessary to accelerate the innovation and development of service trade and the process of opening up the service sector. For example, promoting the development of health service trade not only requires relaxing market access restrictions for the health service industry, but also involves the free flow of personnel, goods, funds and other elements in the health field. Therefore, it is necessary to further promote innovation and management in areas such as mutual recognition of health talent qualifications, mutual recognition of item standards, and corresponding fund payment and transfer systems.

Guangming Daily

[