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Spoiling of Liaoning's business environment is a case in point

China Daily | Updated: 2017-06-21 07:40

Spoiling of Liaoning's business environment is a case in point

Pedestrians walk past the buildings of the Dalian Commodity Exchange in Dalian, Liaoning province, May 30, 2013. [Photo/VCG]

NORTHEAST CHINA'S LIAONING PROVINCE recently publicized a list of the "spoilers" of the business environment, on which appeared several local government departments. For example, the bureau of law enforcement in the Heping district of Shenyang, Liaoning's capital, "rented" offices from an enterprise and refused to pay the rent. China Youth Daily comments:

It was in 2001 that the World Bank first proposed evaluating the ease of doing business in an economy with an index system. In 2016, it released its flagship report on the business environment in 190 economies, Doing Business 2017: Equal Opportunity for All, according to which China's business environment ranks 78th in the world, well behind developed economies.

The central leadership has been paying much attention to China's business environment. In this month alone, Premier Li Keqiang has said several times that China will continue improving its business environment to attract investment.

The business environment is an essential aspect of an economy's global competitiveness. The better the business environment a country has, the easier it is to do business in it. World Bank data show that a good business environment can help investment grow by 0.3 percent and the GDP growth rate to rise by 0.36 percent.

World Bank research also shows that a good business environment needs clear market rules and transparency. Only when the government serves enterprises instead of setting obstacles in their way, will businesses thrive.

However, in Liaoning province, certain government departments have not only set obstacles for businesses, they have also violated enterprises' legal interests, like the example of the "rented" offices cited in the local report. Even after higher authorities required the bureau to pay the rent, they continued to delay paying what they owed.

According to official reports, that bureau is not the only one that hurts enterprises' legal interests. The business environment has to be improved and they have formed a special bureau at the provincial level to regulate it.

The poor business environment in Liaoning has already caused its economy to decline. The GDP growth rate of Liaoning province in 2016 was minus 2.5 percent, making it the only province whose economy shrank. It is time for the Liaoning provincial government to solve that problem, or the province's economic decline will continue.

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