Ask for Advice, Explore the Way (The Reform Views of a Director of the Administration for Industry and Commerce)

Author: He Xia'an
Publisher:
Publishing Date: 2004-05-01
Features: Three exclusions and two negative factors Reform and opening-up are the correct policies that align with the fundamental interests of the entire nation and have initially gained the people's heartfelt support. However, in recent years, various chaotic situations in the socio-economic life and the corruption that has emerged from them have, to some extent, dampened the public's enthusiasm for reform, leaving them in great confusion. This has made the already complex and arduous task of deepening reform even more challenging. Without the heartfelt support and active participation of the broad masses, deepening reform is unthinkable. The importance and urgency of rectification and adjustment lie in this. We must use the actual achievements of rectification and adjustment to enhance the reputation of reform and win the trust and support of the public. There are two negative factors that must be overcome.
First, it is essential to emphasize discipline, prioritizing the overall interest, and upholding the authority of the Central Committee and the State Council. Leadership must be strengthened, ensuring that orders are followed and prohibitions are respected. No longer can we resort to repeated reminders. In particular, law enforcement agencies must emphasize that laws must be strictly followed, violations must be strictly enforced, and those who break the law must be severely punished. In recent years, the Central government has appropriately decentralized power and recognized the diversification of interests, which was originally an important aspect of reform. However, due to the neglect of ideological and political work, discipline has weakened. Localities and departments, driven by their own interests, have ignored the overall interest, strengthening local and departmental protectionism. The famous "red light" theory and "red line" theory were widely spread as reform experiences in this climate. As a result, there was further expansion despite pressure, more control led to inflation, a second wave of company fever after cleanup and adjustment, and a "slow and steady" approach during the second round of cleanup. Selling permits was explained as developing the economy, and offenders might be protected as contributors. Law enforcement agencies, driven by sectoral fragmentation, ignored their sacred mission to enforce the law, instead resorting to flexibility, treating people but not themselves, and dealing with outsiders but not insiders. This is a key reason for the worsening chaos in the economic sector in recent years. To address this issue, in addition to strengthening discipline as mentioned earlier, it is necessary to establish the constitutional status of independent exercise of administrative law enforcement power as soon as possible.
Second, it is unclear which level or department first proposed this, nor can it be traced back to when, but "dividing the spoils" gained a "legal" basis with various division ratios. While rewarding meritorious individuals with strict rewards has always been advocated by the government and is justifiable, why is it linked to stolen money, with rewards and profits based on the amount seized? This inappropriately stimulates unhealthy enthusiasm, compounded by the fact that our regulations are already imperfect and highly flexible, leading to "punishment replacing punishment" and the intensification of profit-seeking among law enforcement agencies while weakening cooperation. You have "market rules," I manage "price policies"; you pursue "disciplinary violations," he investigates "bribery"; you cite "monopoly regulations," I refer to "smuggling penalties"; you impose penalties for "speculation," I classify it as "fraud." On one hand, there is a rush to handle fines and assets, while on the other, case files are passed around like traveling trophies. Not to mention the various unspoken phenomena that arise from this. Many criminal offenders have thus escaped justice. The vicious cycle of "offending and punishing, punishing and offending" is not surprising. This kind of enthusiasm that sacrifices the dignity of the law is indeed unacceptable.
Eliminating the above two negative factors is enough to ensure that the rectification and adjustment policy does not become a hollow slogan. The public is watching us with trust, and we must not disappoint them. The postal and communication equipment industry, now a major industry in Fuyang, was developed by Fang Xuemu, an individual entrepreneur who later became a member of the 8th National Committee of the Chinese People's Political Consultative Conference. Fang Xuemu, originally an employee of the Fuyang Post Office, retired prematurely at the age of 42 in 1982 to allow his rural son to join the post office and secure what was considered the "iron rice bowl" in China. He raised 70,000 yuan, rented a 90-square-meter shed, hired 8 family members of workers, and established Fuyang's first private postal and communication equipment factory. Leveraging his connections as a former supply and marketing agent, he filled gaps, picked up discarded items from large factories, emphasized quality and reputation, simplified procedures, and engaged directly in production and sales. After ten years of hard work, he became the owner of Zhejiang Bell Communication Group Co., Ltd., with tens of millions in assets and tens of thousands of square meters of production facilities.
The success of Fang Xuemu's path inspired others who were influenced by him or trained by him to follow suit, leading to a chain reaction that, over a decade, transformed the industry into a major emerging sector in Fuyang. The products are comprehensive, including optical cables, with a nationwide sales network. By the end of 1997, statistics showed that the city had 144 such enterprises, with a registered capital of 300 million yuan, employing 8,751 people, and generating 2.06 billion yuan in annual output value, making it a pillar industry. Other industries, such as paper and paper products, hardware, and sports equipment, have also developed into a "private army," enriching the local economy and gaining national recognition, with many products exported overseas.
Of course, development is not without challenges. People who have lived in fear for decades are particularly sensitive, and even a small article in the newspaper or a news report on television can trigger their nerves. Take Fang Xuemu, for example. In the year of opposing bourgeois liberalization, he probably sensed the tide turning and, at a meeting, generously offered to donate his entire business to a foundation. Some people are always worried about "aftermaths," so they go to great lengths to register their businesses as collective enterprises to show "common prosperity." These people share a common secret: wearing a "red hat" not only brings immediate benefits but also allows them to wash themselves clean if policies change. Moreover, our policies have long carried the imprint of "public over private," with collective enterprises, school-run businesses, and welfare enterprises enjoying tax exemptions. Who wouldn't be happy to run such public-ownership enterprises? And they could even change their names year after year. Because our policies prohibit private operations in certain "special industries," people are forced to lie and set up fake businesses. Additionally, our credit policies lend to the public but not the private, and the personal career prospects of financial workers lead entrepreneurs to don a "Marxist" exterior for survival and development. All these factors have hindered the healthy development of the private economy and contributed to the decline of the public economy.
The Fuyang Municipal Bureau of Industry and Commerce has conducted two cleanups of these phenomena. The first was in the first half of 1988, when 150 fake collective enterprises were stripped of their red hats. The second was in 1997, when a comprehensive restructuring plan was implemented,ing 964 collective enterprises and converting them into private enterprises. Fuyang's ability to escape poverty and achieve what is considered "modest prosperity" today is an undeniable fact due to the development of the private economy. By the end of 1997, the city had 2,397 private enterprises and 18,143 individual businesses, with a registered capital of 1.70925 billion yuan, generating 9 billion yuan in industrial output value, paying 100 million yuan in taxes, and employing 99,663 people. In a country where urban workers are increasingly laid off and unemployment is rising, and with two-thirds of the nation's 2,200 counties relying on central government subsidies, Fuyang's 610,000 population has 100,000 employed in individual and private businesses, contributing 100 million yuan in taxes. The economic and political significance of this is self-evident.
The private economy can be freely developed in socialist China and achieve its current status because the ruling Communist Party of China has finally recognized that "China is in the primary stage of socialism" and has acknowledged that this stage will last for a very long historical period. As a result, it has formulated a series of policies that allow and suit its development. However, ultimately, without specific departments to effectively implement these policies, things will remain as they are in many aspects of China—everyone seems to be managing, yet no one is managing, making development difficult. Administrative and commercial management has been thrust into the forefront in this historical opportunity.
The waters of the Fuchun River in Zhejiang flow endlessly. The beautiful Fuchun River records the historical changes of Zhejiang Fuyang: the earliest to surge with the waves of reform; the earliest to boldly propose vigorously developing individual and private economies; the earliest to regard individual and private economies as the driving force for revitalizing the local economy. It is precisely because of such "earliest" achievements that Fuyang's GDP reached 10.19 billion yuan in 2000, with fiscal revenue exceeding 700 million yuan, 80% of which came from the non-public sector, with results that are clear for all to see.
The rapid development of individual and private economies in Fuyang has required tremendous efforts from the local administrative and commercial departments. Their guidance and cultivation have enabled individual and private business owners in Fuyang to achieve prosperity earlier. The prosperous people of Fuyang are now thinking about what to do in today's market economy, when everyone complains about a credit crisis. Once again, Fuyang has taken the lead in the nation in building the "credit project" for individual and private enterprises. During an interview in Fuyang, individual and private business owners there expressed immense confidence in their creditworthiness. The "Enterprise Credit Publicity Project" launched by the Fuyang Branch of the Hangzhou Bureau of Industry and Commerce has generated extremely strong social. Experts believe it is a creative exploration for Chinese enterprises to move toward a market economy and achieve a standardized market order.
In the current process of rectifying and regulating the market economy, what can the "Enterprise Credit Publicity Project" bring to enterprises? What role can it play in regional economic development? What contribution can it make to society? Journalists, a series of questions, interviewed He Xia'an, the head of the Fuyang Municipal Bureau of Industry and Commerce and the advocate of the "Enterprise Credit Publicity Project."
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