Supply continues to expand; industrial structure sees faster upgrading

Since the beginning of the year, China's economy has maintained a positive trajectory of recovery and structural improvement despite a complex and challenging external environment and tasks of reform, development and stability at home.

From the production perspective, supply has continued to expand, while the industrial structure has undergone faster upgrading driven by greater self-reliance and strength in science and technology. New quality productive forces are taking shape through practical application and have emerged as a strong driver of high-quality development.

From a livelihood perspective, employment has remained generally stable, prices have stayed moderate and manageable, and the social safety net has continued to improve.

In terms of growth drivers, the economy is witnessing a faster optimization of development momentum. Strategic emerging industries and industries of the future — including new energy, artificial intelligence, biomanufacturing and commercial aerospace — are developing in clusters.

A growing number of new sectors and business tracks are generating strong spillover effects, helping offset pressures stemming from the weakening of traditional growth drivers.

These developments demonstrate the resilience of the Chinese economy, its vast development potential and its favorable long-term prospects. While structural and cyclical challenges remain, confidence in China's development outlook should be strengthened.

The country possesses the world's most complete industrial system, a massive market with enormous potential, abundant talent resources and institutional advantages that continue to be released.

Against this backdrop, market entities should seize opportunities and place innovation at the center of modernization efforts. Sci-tech innovation should be leveraged to drive industrial innovation, particularly through disruptive and frontier technologies capable of fostering new growth engines.

Enterprises should strengthen operational management, improve modern governance capabilities and conduct business in strict compliance with market rules, as well as laws and regulations.

At the same time, greater emphasis should be placed on risk management. Enterprises need sound mechanisms for risk identification, early warning and response in order to better cope with external containment and suppression, market volatility and rising costs.

In the broader process of advancing high-quality economic and social development, businesses should not only serve as witnesses, but also as active contributors, providing solid support for the overall economy through their own stable and healthy development.

A problem-oriented approach remains essential to sustaining healthy economic growth.

Improving macroeconomic policies by addressing the most pressing concerns of market entities is a key part of this process.

At present, many enterprises continue to face common operational challenges. Some place greater emphasis on investment and project construction than on subsequent management and operational efficiency.

Others focus heavily on hard assets — such as infrastructure and fixed-asset investment — while paying insufficient attention to soft strengths, including institutional development, brand value, data assets and management capabilities.

Another challenge lies in unsustainable development patterns. In some cases, inadequate long-term strategic planning and excessive pursuit of short-term expansion have led to the accumulation and exposure of structural risks.

These issues are related not only to the management capabilities of some business entities, but also to the effectiveness of policy transmission and implementation.

Institutionalized communication between government and businesses should therefore be regarded as an important channel for improving macroeconomic policymaking efficacy. Policymakers need to engage directly with enterprises, gain a detailed understanding of practical challenges and listen to voices from the front lines of production.

Suggestions and reasonable appeals raised by businesses should be carefully categorized, systematically documented and thoroughly studied.

Efforts should combine targeted solutions with broader institutional improvements. At the micro level, precise measures should be introduced to address industry-specific difficulties and challenges faced by individual enterprises.

At the macro level, policymakers should systematically identify common and institutional obstacles, strengthen policy coordination and consistency, and avoid policy distortions caused by either overly fragmented or overly generalized approaches.

Institutional innovation is also needed to remove bottlenecks in policy implementation and ensure that policies effectively reach market entities.

Doing so will help address deep-seated problems such as inadequate operational management, insufficient investment in soft capabilities and unsustainable development practices.

More importantly, it will enable macroeconomic policies to be translated from abstract documents and figures into tangible institutional dividends and practical support that businesses can genuinely access and benefit from, thereby enhancing confidence in and recognition of government policies.

Looking ahead, achieving both qualitative improvement and reasonable quantitative growth requires adherence to the principle of pursuing progress while maintaining stability, promoting stability through progress and establishing the new before abolishing the old.

Greater innovation and vitality should be fostered through positive interaction between effective macroeconomic guidance and proactive efforts by market entities.

China should continue to uphold and improve its basic socialist economic system, unswervingly consolidate and develop the public sector, and encourage, support and guide the development of the nonpublic sector.

The legitimate rights, interests and property rights of all market entities should be protected in accordance with the law, while efforts should continue to build a world-class business environment that is market-oriented, law-based and internationalized.

Further reform and opening-up remain essential. Institutional barriers that hinder the market-based allocation of production factors and the efficient circulation of goods and services should be removed, while efforts to build a unified national market should be hastened.

At the same time, greater attention should be paid to improving the coordination, precision and effectiveness of macroeconomic policies. Policymakers need to balance the expansion of domestic demand with deeper supply-side structural reform, coordinate short-term growth with long-term development potential and better integrate development with security.

Enterprises should also be encouraged to accelerate the transformation of their development models and build core competitiveness through technological, managerial and business-model innovation. Greater efforts should be made to pursue specialized, sophisticated, distinctive and innovative development while advancing green, low-carbon and sustainable growth.

Only by better combining an efficient market with a well-functioning government can the stability and predictability of macroeconomic policies work in tandem with the initiative and creativity of market entities.

In this way, China's considerable resilience and development potential can be transformed into tangible growth advantages, opening new horizons for high-quality development, while laying a stronger material and technological foundation for building a modern socialist country in all respects.

The writer is a senior research fellow at the Chinese Academy of Macroeconomic Research.

The views do not necessarily reflect those of China Daily.