China market entities seen recovering in first half

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China market entities seen recovering in first half

The employees of Shandong Marine Group display a fish at an aquaculture base in Qingdao, Shandong province. YU FANGPING China's top market regulators said on Wednesday that the number of newly established market entities, including companies and self-employed, saw 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.

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

In the first quarter, newly established market entities increased by 7.5 percent year-on-year. The number was 1.4 percent in May and a whopping 19.7 percent in June, despite a drop in April.

The 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, senior researcher at the Chinese Academy of International Trade and Economic Cooperation.

China has continued to support market entities with measures like tax cuts and fee deferrals to boost market players' confidence in the face of the epidemic. By July 20, China's accumulated tax refunds, tax and fee cuts, and tax and fee deferrals topped 3 trillion yuan $444 billion, according to the State Taxation Administration.

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

Over 2.29 million businesses related to new technologies, industries, business formats, and models were newly established in the first half. They accounted for 54.2 percent of all new companies. 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, said digital resilience is a key factor for Chinese companies to respond quickly to business disruptions due to the outbreak of contagion.

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

By the end of June, there were 5.095 million registered enterprises in the core digital industries, accounting for just over 10 percent of all market entities.