Yao said unlike the private economies of other provinces, Zhejiang's was formed by the joint development of and interaction between private enterprises and commodity markets. Under this pattern, different villages, counties and cities in Zhejiang specialize in manufacturing different products such as leather shoes in Wenzhou, textiles in Shaoxing, home appliances in Ningbo, and motorcycles and parts in both Wenzhou and Taizhou.

ZDRC figures indicate that by now there are 4,096 special commodity markets in the province, whose total transactions amounted to 932.5 billion yuan ($136.13 billion) in 2007, making Zhejiang the most productive province in this regard for 17 consecutive years.

That's the spirit

"The reputation of private enterprises in Zhejiang is rooted in the people's pioneering spirit of ‘being boss in the daytime and sleeping on the floor at night,'" Yao said. "Wherever they go, they can survive and develop."

Because Zhejiang has few natural resources and is often prone to natural disasters such as typhoons, its citizens have developed the traits of endurance and hard work. These factors also have forced many to leave the province and seek their fortunes elsewhere by creating overseas marketing networks for companies back home. Zhejiang businessmen have established business communities known as "Zhejiang villages," "Wenzhou villages" and "Yiwu trade cities" in many cities throughout China and in some foreign countries.

The provincial government also has been helping to foster the continued growth of private enterprises by creating a liberal atmosphere necessary for their development.

Self-improvement

Despite their success, some private enterprises in Zhejiang also have in-born deficiencies.

"Set up by farmers who are poorly educated, many private enterprises are faced with the problems of technologies, management, talent and equipment, such as an overly intense ownership structure and a low level of decision making," Yao said.

ZDRC figures show that 99 percent of the province's private enterprises are small and medium-sized ones.

"Although some large-scale private enterprises have adopted international practices, the small and medium-sized private enterprises still have a long way to go," said Yao, adding that innovation is an urgent task for them. He said the government also would create some policies to promote the transformation and upgrading of private enterprises.