June 28 marked a major step in China's push to build a unified national electricity market. On that day, a new regional power exchange, linking the southern administrative divisions of Guangdong, Yunnan, Guizhou and Hainan provinces and Guangxi Zhuang Autonomous Region, began trial operations with round-the-clock trading and real-time clearing of transactions. The new exchange now constitutes the world's largest and busiest electricity marketplace.

With more than 220,000 registered entities and a daily trading volume topping 3.8 billion kilowatt-hours, this regional market now handles more electricity transactions than the United Kingdom, France and Germany combined.

This is part of a broader trend in which the market plays a decisive role in allocating resources across the country.

In a world where markets are resource, China's colossal and fast-growing market remains one of its greatest strengths. With some 1.4 billion people, the world's largest middle-income population, nearly 190 million registered businesses and the world's only supply chain that encompasses every category in the United Nations' industrial classification, China is uniquely positioned to leverage the power of a market that is not only vast but also poised for sustainable growth.

The country's latest economic data underscore this potential. In the first half of 2025, despite an increasingly complex outside world, China's GDP still managed to pull off a 5.3-percent year-on-year growth, with domestic demand accounting for 68.8 percent of that growth.

As global uncertainties mount, China is placing a greater emphasis on its domestic market as a strategic means of shoring up its economy against the growing volatility of global trade. The need for building a unified home market has never been greater.

President Xi Jinping underscored this priority at a meeting of the Central Commission for Financial and Economic Affairs, the country's top financial and economic policymaking body, on July 1. He emphasized that building a unified national market is essential to shaping a new development paradigm, with the domestic market as the mainstay and domestic and overseas markets reinforcing each other, and advancing high-quality growth. He also called for stronger coordination and cooperation to ensure aligned and effective implementation.

The meeting further highlighted that building a unified national market requires unifying underlying market institutions, market infrastructure, government conduct, regulatory enforcement and markets of production factors and resources, while continuing to expand opening up both internally and externally.

Rapid rollout 

Once the goals were set, the entire country was mobilized to take swift action.

Efficiency and standardization are being improved through reforms that enhance the role of public investment in driving private capital, while steadily removing entry barriers for private firms. The aim is to establish a self-sustaining, market-driven investment climate.

At the same time, China is introducing durable policies to boost consumption—ranging from raising incomes and boosting employment to expanding the supply of quality goods and improving the consumer environment.

Meanwhile, a series of measures have been implemented to safeguard fairness—a core principle of the market economy. These include tighter product compliance inspections, stricter action against unfair competition, tougher crackdowns on counterfeit and substandard goods and clearer standards aimed at fostering healthy competition.

The country is stepping up efforts to break down barriers between regions, industries and markets to allow capital, labor and other resources to flow more freely.

As it strengthens its domestic market, China is looking to attract top-tier global resources—an effort aimed at forging a new edge in international competition and cooperation.

Breaking down barriers 

Building a unified national market is a dialectical process of both dismantling and building. It calls for tackling pressing problems head-on by breaking down barriers. At the same time, it also advocates a type of long-term, reform-minded thinking, one that focuses on creating a fertile ground for business growth.

The key to ensuring that China's market economy runs efficiently is to strengthen its fundamental institutions.

On August 1, 2024, the Fair Competition Review Regulations officially came into effect. The regulations require administrative authorities to conduct fair competition reviews when drafting laws, rules and policies related to business activities. This measure ensures that the government consistently upholds fair competition and respects the market's decisive role in allocating resources—thereby better fulfilling its role.

Making sure that people can live and work more conveniently and move more freely is also central to building a unified national market in a country where, every year, some 150 million people move between provinces to live or work.

In the push to create a unified market, a series of barriers are being removed. Household registration rules that once restricted people from joining social security programs due to relocation have been lifted; a unified, well-regulated national labor market is taking shape; new systems are making it possible to share medical test results between hospitals and withdraw housing provident funds from anywhere in the country. The housing provident fund is a long-term housing savings plan made up of compulsory monthly deposits by both employers and employees. It can only be used by employees for house-related expenses.

These steps are tackling long-standing inconveniences in everyday life, while enabling freer personnel flow and more effective use of talented people.

Additionally, eliminating all forms of entry barriers and guaranteeing equal market access for all business entities are necessary steps to unleash market potential and ensure the smooth running of the economy.

Take the aerospace industry as an example. In 2021, the southern island province of Hainan rolled out a series of measures to support local commercial space activities. This has allowed the rise of a highly integrated industrial chain spanning research, manufacturing, launch and application services.

As of the end of February, the Wenchang International Space City, China's first commercial spacecraft launch site, located in Hainan, housed more than 700 space-related businesses, with 26 directly involved in the satellite supply chain.

Finally, it is imperative to eliminate local protectionism and regional barriers by maintaining consistent rules and standards across the country.

In late April, a deal between a company in Anhui Province and another in neighboring Jiangsu Province offered a glimpse of what that future might look like. Through the China Water Exchange, the country's first and only national water trading platform, the Anhui firm agreed to transfer the right of use on 70,000 cubic meters of industrial water to its Jiangsu counterpart by the end of this year.

By breaking provincial boundaries and shifting toward a more market-driven mode of water resources management, the deal offers a fresh approach to integrating water rights reform, ecological protection and economic growth.

From local protectionism to market fragmentation and excessive competition, the key to addressing these issues lies in pressing ahead with comprehensive reforms, which means challenging outdated thinking, breaking up vested interests, and, in doing so, fostering a truly unified market within a high-standard socialist market economy.

International outlook 

Building a unified national market does not mean China should isolate itself from the rest of the world. Instead, it means boosting domestic consumption through greater opening up, while promoting interaction with the global economy.

A case in point is Airbus's deepening relations with China. On June 25, 1985, China received its first Airbus aircraft—a landmark moment marking the company's entry into the Chinese market.

Today, China has become the largest single-country market for Airbus commercial airplanes. The company has set up a complete local industrial chain covering some 200 suppliers and spanning everything from raw materials to final assembly. Its A320 final assembly line in Tianjin—the first outside Europe—has delivered nearly 800 aircraft to customers.

Looking ahead, a second final assembly line in Tianjin will begin production in 2026, doubling China's output of A320 jets. This will mean that one fifth of the global production of A320 family aircraft will be based in China.

As President Xi said in a meeting with representatives of the international business community in March, "Embracing China is embracing opportunities, believing in China is believing in a better tomorrow, and investing in China is investing in the future."

His message signals China's steadfast commitment to deepening reform and further opening itself up, which has injected great confidence and momentum into the country's pursuit of global cooperation and common prosperity.

Building on this vision, the drive to create a unified, open and vibrant national market will anchor the Chinese economy in greater strength and stability, while opening up a wider space for shared growth globally.

This is an edited excerpt of an article published by Xinhua News Agency

Copyedited by G.P. Wilson 

Comments to pengjiawei@cicgamericas.com