1. Easy come easy go
On Wednesday, Premier Li Keqiang did his thing – chairing the weekly State Council executive meeting.
Top of the agenda: Approving new draft regulations to improve the business registration system.
Li says easing business administration is vitally important for (Gov.cn 2):
- “Developing the socialist market economy”
- “Providing legal safeguards to … fair competition”
- “Promoting abundant employment”
Some context: Due in part to Li’s consistent efforts, more than 60 million new businesses were registered in the past five years (2016-2020) alone.
Li wants to make business registration even easier with:
- More timely, one-stop, and online services
- More convenient cross-provincial registrations and increased data sharing
- Simplified documentation requirements
That’s not all: The new regs make it easier for businesses to deregister – or just take a break.
- Businesses may be approved to close and deregister under streamlined processes if they promise to assume legal responsibilities and pay off debts, taxes, and wages.
- Businesses can formally pause operations for as long as three years, and avoid operational costs from accumulating during natural disasters, accidents, or public health emergencies.
Get smart: Offering companies an easy way out is just as important as eliminating entry and registration barriers.
2. Wang Yang tours Inner Mongolia
On Wednesday, Wang Yang, the chairman of the Chinese People’s Political Consultative Conference (CPPCC), wrapped up a four-city, three-day inspection tour of Inner Mongolia.
Some context: Inner Mongolia has a large percentage of ethnic minorities. Last year, it saw protests over plans to phase out Mongolian as a language of instruction.
Wang was there to continue pushing Mandarin (CPC People):
- “It is necessary to accelerate the promotion of the national common spoken and written language [and] do a solid job in the promotion of using national standardized textbooks.”
- “This allows the people of all ethnic groups to better access scientific and cultural knowledge, be more employable, and integrate into modern society.”
Wang also said unity is more important than autonomy:
- “The exercise of autonomy in autonomous regions must be predicated on ensuring the implementation of the constitution, national laws, and central government decrees to maintain the unity of the socialist legal system.”
Get smart: The Party sees pairing economic development with a push for ethnic unity as the right recipe for stabilizing China’s border regions.
The bottom line: Beijing’s approach toward ethnic minority groups has shifted.
- The focus is now on assimilating these groups, rather than granting them greater autonomy.
3. You might have forgotten the holiday, but it didn’t forget you…
Today is China’s National Security Education Day!
Some context: This holiday was declared in the National Security Law, as of 2015, to promote public awareness of national security issues.
The Ministry of State Security (MSS) got festive with an editorial in the People’s Daily on Thursday.
Unsurprisingly, MSS shared some security concerns:
- “We must be soberly aware that various hostile forces have not stopped…subversion and sabotage of the Party leadership…and are always planning ‘color revolutions’ in our country.”
The ministry is standing firm against:
- “All kinds of risks and challenges to the Party leadership and the socialist system”
- “All kinds of risks and challenges to sovereignty, security, and development interests”
- “All kinds of risks and challenges that endanger China’s core interests and major principles”
…You get the idea.
Luckily, Yin Li, Fujian’s provincial Party secretary, gave us more specifics.
Yin’s security agenda includes protecting:
- Governance, systemic, and ideological security
- Critical infrastructure, strategic resources, and technology
- Food and energy security
- Industrial and supply chains
- Safe production
- Food and drug safety
- Ecological and biosafety
- Overseas interests
Get smart: National security has permeated almost every aspect of the government’s agenda.
Get smarter: Security concerns will continue to rise as top leaders focus on competition with the West.
4. Big tech makes some big promises
A bunch of big tech companies are pledging to mend their ways.
Quick refresher: Yesterday, we told you that antitrust regulators set a one-month deadline for 34 tech companies to rectify antitrust violations and told them to make their compliance commitments public (see April 14 Tip Sheet).
- All the big tech names were at the meeting.
Already, 23 of the 34 companies have issued public statements committing to correct a whole bunch of antitrust violations.
ICYMI: The most common antitrust issues tech companies need to fix include:
- Forced exclusivity – whereby companies pressure online vendors not to list products with competitors
- Failure to report large acquisitions
- Unfair product pricing
- Abuse of personal data
Get smart: The public has been grumbling about these practices for years.
- Now regulators are finally taking action.
5. PBoC working paper recommends policy response for demographic woes
Nothing puts us in a babymaking mood more than a gaggle of central bankers telling us to do it for the good of the nation.
- Say what now?
A new working paper from the People’s Bank of China (PBoC) entitled “Understanding and Responding to China’s Population Transition” is making waves.
- The paper sounds the alarm about falling birth rates and the rapidly rising share of the population that is past retirement age.
The paper warns that demographic change will result in declining productivity (PBoC):
- “Education and technological progress cannot compensate for the decline in population.”
That will put China at a disadvantage vis-a-vis the US:
- The paper includes an extensive section comparing the two countries – and things don’t look great for China.
But what can be done?
The paper calls for rolling back all current policy constraints on family size immediately.
Some context: China relaxed family planning restrictions (aka the “one child policy”) in 2015, but the birth rate has continued to fall.
- In 2020, only about 10 million babies were born – a 15% drop from 2019.
The paper goes further, proposing policy efforts to reduce the costs of pre- and neonatal healthcare, childcare, and schooling.
Also on the agenda – efforts to blunt the impact of rising elder care costs, including:
- Maintaining a relatively high savings rate
- Supporting investment in the sector
- Undertaking pension reform
Get smart: Top leaders are finally figuring out that having kids is difficult and expensive.
- Family planning restrictions haven’t been the driving force behind falling birth rates for a while now.