China’s renewed support for self-employed seen as only short-term fix as long as zero-Covid remains

Name: How ordinary people in China view the country’s ‘dynamic zero-Covid’ policy
Uploaded: 2022-10-28T02:00:24.000Z
Duration: 3 min 8 s
Description: How ordinary people in China view the country’s ‘dynamic zero-Covid’ policy

Outgoing Premier Li Keqiang on Tuesday signed a State Council decree to update regulations for self-employed businesses which had been in place for 11 years

The 111 million self-employed people China, seen as a key part of the economy, have struggled amid the economic downturn and stringent coronavirus policies

Reading Time:3 minutes

Why you can trust SCMP

The 111 million self-employed people in China account for two-thirds of all market entities, offering jobs for nearly 300 million people in September. Photo: EPA-EFE/ALEX PLAVEVSKI ATTENTION: This Image is part of a PHOTO SET

Mia Nulimaimaiti

Published: 10:00am, 28 Oct 2022

China’s renewed pledge to support self-employed businesses struggling amid the coronavirus-induced economic downturn has been met with a muted response as it is seen to only offer short-term relief as long as Beijing’s zero-Covid policy remains.

The updated regulations, signed via a State Council decree by outgoing Premier Li Keqiang on Tuesday, introduce more content on equal treatment for self-employed businesses, while also reducing the threshold for sole proprietors to set up a small business.

The new “Regulation on Promoting the Development of Self-employed Businesses”, which had been in place for 11 years, will take effect from Tuesday and also includes promises for further tax and financial help.

In the short term, this regulation will improve the economy, but we can’t rely on this alone

Ding Shuang

“The document is still more of an institutional arrangement that is not designed to quickly recover the financial losses of the self-employed … but to support its economic development for the long-term,” said Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered Bank.

“In the short term, this regulation will improve the economy, but we can’t rely on this alone, since the main constraint is still the pandemic policy, and ultimately it will depend on whether the Covid control can be further relaxed.”

The changes represent Beijing’s latest attempt to protect the so-called capillaries of China’s economy, which have struggled amid the economic downturn and stringent coronavirus policies.

The 111 million self-employed people in China account for two-thirds of all market entities, offering jobs for nearly 300 million people in September, according to data from the State Administration for Market Regulation.

03:08

How ordinary people in China view the country’s ‘dynamic zero-Covid’ policy