China should give greater weight to the development of private enterprises, enhancing support for private industrial parks to issue public real estate investment trusts (REITs), according to a Shanghai delegate to the ongoing Two Sessions 2023.

China's private economy plays a pivotal role in economic and social development, which posts tax contribution of over 50 percent, more than 60 percent of the gross domestic product, technological innovation and new product development accounting for more than 70 percent, urban employment of more than 80 percent, and the number of private enterprises accounting for more than 90 percent of all companies.

"The healthy development of the private economy is inseparable from a level playing field and a sound legal system," said Zhou Tongyu, a deputy to the National People's Congress, vice president of the Shanghai Federation of Industry and Commerce, and chairwoman of Weida Hi-Tech Group.

However, the current lack of legislation on the private economy, judicial injustice and other issues, to a certain extent, hindered the robust development of the private economy, she pointed out.

Zhou proposed strengthening the top-down design for the healthy development of the private economy, with unified legislation on the development of private enterprises at the national level.

It's recommended to formulate laws on promoting research and development of private economy, and to establish unified norms on private enterprise market access, equal participation in market competition, and protection of the legitimate rights and interests of private enterprises.

She suggested that the government should open a management agency focusing on private economy in the relevant functional departments.

Unified and transparent market rules as well as the supporting policies to promote the development of private enterprises should also be formed and optimized.

Seeing the financing difficulties, meanwhile, Zhou also called on more support for private industrial parks to launch publicly traded real estate investment trusts (REITs).

The launch of domestic publicly traded REITs may help open up the whole chain of "investment, financing, management and exit" of industrial parks and realize the asset-light development of industrial park enterprises.

"But from the actual issuance, the current public REITs project is still dominated by those with state-owned shareholders while there are only two private REITs, which to a certain extent limits the financing and development of private industrial parks," Zhou said. She proposed further improvement and reforms in the issuance policy and practical operation.

Specifically, Zhou called for active support of the development of private industrial parks in terms of both policy and market. She also suggested that regulators such as the China Securities Regulatory Commission and stock exchanges should increase their support for the issuance of REITs by high-quality private industrial parks.

While the current policies put forward high requirements for the qualification of fund managers, she suggested to improve the pilot policies and rules and continuously optimize the policies on fundraising, exit and taxation, to lower the barrier for private enterprises to launch pre-REITs funds.