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V-shaped bounce for new market entities

By CHENG YU | China Daily | Updated: 2022-08-18 06:58
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Employees of Shandong Marine Group display a fish at an aquaculture base in Qingdao, Shandong province. [YU FANGPING/FOR CHINA DAILY]

China's top market regulator said on Wednesday that the number of newly established market entities, including companies and the self-employed, witnessed a V-shaped recovery in the first half, as market confidence from various businesses continued to get a boost despite ongoing COVID-19 resurgences and a shaky external environment.

According to the State Administration for Market Regulation, the total number of market entities hit 161 million as of end-June, up 4.4 percent compared with the end of last year.

In the first quarter, newly established market entities increased 7.5 percent year-on-year nationwide. Though witnessing a drop in April, the number quickly recovered to 1.4 percent in May and a whopping 19.7 percent in June.

"The steadily increasing number of market players in the first half showed that market vitality has remained stable after implementation of a series of policies and measures to stabilize the economy," said Han Jiaping, a senior researcher with the Chinese Academy of International Trade and Economic Cooperation.

To boost confidence of market players amid the epidemic, China has continued to support market entities with measures like tax cuts and fee deferrals. By July 20, China's accumulative tax refunds, tax and fee cuts, and tax and fee deferrals topped 3 trillion yuan ($444 billion), said the State Taxation Administration.

Notably, the SAMR said that an increasing number of new market entities were new economy-related and such growth in the first six months is significantly higher than the overall level.

In the first half, over 2.29 million enterprises related to new technologies, industries, business formats and models were newly established. They accounted for 54.2 percent of total new companies. Among them, the growth rate of newly established firms in modern agriculture, forestry, animal husbandry and fisheries as well as new energy all exceeded 30 percent during the period.

Huo Jinjie, president of International Data Corp China, a market research firm, said digital resilience-which refers to an organization's ability to rapidly adapt to business disruptions by leveraging digital capabilities-has become a key for Chinese companies to quickly respond to business disruptions amid contagion outbreaks.

The digital industry also provided clear support to market vitality with 604,000 enterprises in the sector being newly set up in the first half, up 20 percent year-on-year.

By the end of June, the number of registered enterprises related to core digital industries reached 5.095 million nationwide, accounting for just over 10 percent of all market entities.

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