With an irreversible trend, China's market-oriented economy is
bound to become a mature market economy. As an important part of
China's market economy, the process of the development of
market-oriented domestic trade coincides with the development of
economy, the deepening of reforms and the further opening-up to the
outside world.
(Ⅰ)Further Marketization of Trading
Entities
1. Restructuring Slate-Owned Domestic Trading
Entities
State-owned domestic trading entities shall be further
reorganized or transformed in accordance with the Company Law of
the People' s Republic of China, to become independent economic
entities that make their own managerial decisions, take full
responsibility for their own profits and losses, and conduct
business, go bankruptcy or pay off debts by law. Then, the domestic
trade will be in a situation that various economic entities
(including legally established companies and individual businesses
etc) can compete equally.
2. Internationalizing Domestic Trade
It is mainly revealed in the two trends: one is domestic trading
entities' accession to the international market, and the other
foreign trading entities' entry into the Chinese market. With the
further opening-up of China's economy and its merging with the
whole international economy, more international companies will
enter China for investments, participating in the domestic
circulation trade activities. The same period will see more
domestic trading entities expand their business beyond China.
3. Integrating Domestic and Foreign Trades
With the further deepening of reforms in China's economic
system, the division between the domestic trade and the foreign
trade will be replaced with an integration of the domestic trade
and the foreign trade. Furthermore, with the continuous upgrade of
market openness, each economic entity shall be granted tile right
to market its commodities at home and abroad.
(Ⅱ)Further Marketization of Prices
1. Prices of Commodities and Services
In a competitive sector, the price for a certain commodity is
determined by the relation between supply and demand. For naturally
monopolized products and important products related to the national
economy and the people's livelihood, their prices shall be decided
by means of holding price policy hearing in conformity with the
provisions and requirements of Price Law of the People's Republic
of China. In the end, price shall be decided in a democratic and
open manlier.
2. Factor Prices
With the gradual improvement and maturity of factor markets like
labor market, capital market and land market etc, the factor prices
in domestic market shall be further market-oriented. The factor
prices and products' market prices are complementary, forming a
market price system reflecting the development of China's market
economy.
3. Harmonization of Domestic and International
Prices
With the deepening of the opening-up to the outside world and
the development of China's foreign economic and trade relation, the
domestic commodity prices are bound to be consistent with the
international market prices, and a free trade system framework
under appropriate control shall be established in China.
(Ⅲ)Government Administration to Be Further Law
Based
1. Government administration to be further legislation
supported, standardized and systematized
By means of further improving relevant laws and by laws
regulating various legal relations resulted from file running of
domestic trade, the whole domestic trade is to be run within the
legal framework, including domestic trading entities (to be
organized, run and go bankruptcy by laws), prices and the whole
process of running domestic trade.
2. Cultivating intermediary organizations
In the wake of further maturity of market economy, it is certain
that government control over the domestic trade shall be shifted in
many aspects to intermediary organizations, such as agency engaged
in brokerage, and those supplying specialized services for the
society or supervising and managing economic activities (including
law firms, accounting firms and auditing firms etc), which will
play a more important role.
3. Shifting government function from regulation to
service
In the domestic trade, a complete change in government function
will be realized from administration to service. The government
administration function on the domestic trade will be mainly
revealed in the following aspects: establishing a sound trading
order and defending a market environment with fair competition,
opposing monopoly and unfair competition and providing a system to
ensure the whole market economy operated orderly.
(Ⅳ)Government Controlled Commodities to Be Further
Market-Oriented
In the wake of building a market economy, the commodities and
services controlled by the government shall be given a further
reform. Some of the commodities like grain, cotton, crude oil and
oil products etc will be grouped into the national strategic
material or ordinary commodity. Operational enterprises shall be
further restructured in accordance with the requirements of modern
enterprises system, being really integrated with the market economy
system. In addition, some others such as telecom, railway, civil
aviation etc shall be given a further reform in conformity with the
requirements of the market economy law, becoming real market
economy entities.
In a word, under the precondition of observing the international
practice, market economy law and running rule without any prejudice
to China's national interests, the marketization of China's
domestic trade will be pushed forward constantly.
(China.org.cn November 7, 2003)
