The current situation, challenges, and future of the construction of a unified national market
Background and significance of building a unified national market
The construction of a unified national market is a fundamental support and inherent requirement for building a new development pattern. China possesses the world's most complete industrial system, comprised of numerous major, medium, and minor industrial categories. However, in the past, relatively closed and fragmented regional markets have constrained further economic development. Building a unified national market aims to integrate these relatively independent regional markets into a unified, efficient, smooth, open, and interconnected system. By breaking down regional barriers, unifying institutional rules, and facilitating the circulation of factors of production, it injects greater resilience, higher efficiency, and broader space into the domestic economic cycle, activating the endogenous driving force of a large economy. Simultaneously, this is also a crucial lever for using the stability of the domestic economic cycle to offset the uncertainties of the international economic cycle, laying a solid foundation for Chinese-style modernization.
The Development Process and Conceptual Shift of the National Unified Market
The initial framework for building a unified national market was "five unifications and one elimination." The "five unifications" included unified basic market rules and regulations, unified factor and resource markets, unified commodity and service markets, unified and interconnected market infrastructure, and unified market supervision. This established a consistent national operating foundation from multiple dimensions, ensuring the free flow and efficient allocation of resources and commodities. The "one elimination" addressed the core problem of local protectionism and market segmentation by accelerating the cleanup and abolition of policies and regulations that hinder fair competition, and breaking down closed "small markets" and self-contained "small cycles." This framework has achieved positive results in practice, addressing a number of market segmentation issues, stabilizing development expectations, and releasing market vitality.
However, practice has also revealed the limitations of simply "breaking down" existing barriers; local protectionism and market segmentation remain persistent problems. Against this backdrop, the Sixth Meeting of the Central Financial and Economic Affairs Commission proposed a new requirement of "five unifications and one opening up," including unifying basic market institutions, market infrastructure, government behavior standards, market supervision and enforcement, and factor resource markets, while continuously expanding domestic and international openness. This shift signifies that China's market-oriented reforms are navigating deeper waters, moving from a tactical level of "solving problems" to a strategic level of "designing a system." Domestic openness emphasizes building a truly open and fair competitive arena, ensuring equal competition for all types of enterprises; international openness promotes the alignment of domestic market rules with high-standard international rules, enhancing the international competitiveness of Chinese enterprises and their influence in international economic governance; and more importantly, it represents a shift from "problem-fixing" to "system building," constructing an institutional framework that incentivizes innovation, promotes competition, and ensures fairness through top-level design.
Obstacles to building a unified national market
The core obstacle to building a unified national market lies in the long-standing governance model of local governments, particularly their fiscal incentive and performance evaluation systems. The "tournament model" among local governments closely links the promotion and evaluation of local officials to regional economic growth indicators. While this has historically stimulated local economic development, it has also sown the seeds of market fragmentation. To win in the competition, local governments tend to invest in short-term projects, neglecting cross-regional collaborative industrial ecosystems. In strategic emerging industries, the pursuit of early advantage through extraordinary preferential policies has led to large-scale, low-level duplication of construction and industrial homogenization, resulting in resource misallocation, overcapacity, and local debt problems, as well as vicious "involution" competition within the industry.
Furthermore, "involutionary" competition is a major obstacle to the current development of a unified national market as it enters a more complex phase. Involution is essentially irrational and excessive competition, negatively impacting businesses, industries, and the macroeconomy. Businesses resort to low-price sales to maintain market share, leading to losses; industry profit margins decrease; R&D investment capacity is weakened; industrial transformation and upgrading are hindered; and expanding consumption and improving domestic demand are detrimental. Local protectionism is a significant cause of involutionary competition. Local governments' "race to the bottom" distorts resource allocation, undermines market fairness, and exacerbates market segmentation between regions, contradicting the requirements of a unified national market.
Measures to promote the construction of a unified national market
Building a brand-new government performance evaluation system
Reforming the current performance evaluation system that judges success solely by growth is crucial. A comprehensive evaluation system that fully reflects the essence of high-quality development should be established, shifting the focus from "quantity" and "speed" to "quality" and "efficiency." This system should encompass dimensions such as the quality of the business environment, development quality and innovation momentum, fiscal health and sustainability, and improvement of people's livelihoods and green development, fundamentally changing the incentives for local government behavior.
Rebuilding the foundation of local finance
Establish a central-local fiscal relationship characterized by "clear responsibilities, coordinated financial resources, and regional balance," with consumption tax reform as a breakthrough. Shift the main collection point of consumption tax from production to consumption, and allocate the revenue to local governments, linking local fiscal revenue to local final consumption levels. This will guide local governments to shift from "protecting producers" to "serving consumers," thus reshaping the foundation of local finances.
Using digital means to promote transparency in government governance
Establish a unified digital disclosure platform, requiring local governments to disclose all aspects of their government procurement, bidding, and investment attraction policies and agreements, except for classified information, on a nationally unified platform for public oversight. Introduce AI-driven intelligent supervision, utilizing AI and big data analytics to screen and identify patterns in transaction data, strengthening oversight and reducing opaque operations driven by local protectionism.
Safeguarding market development with the rule of law
Formulating regulations for the construction of a unified national market is of great significance. It can establish and form unified and authoritative rules for market activities and supervision, break down local protectionism and market segmentation, and ensure a stable, fair, transparent, and predictable market environment; clarify the boundaries between the government and the market, achieving an organic combination of an "effective market" and a "capable government"; provide universal regulatory rules for the basic aspects of market operation, filling legislative gaps and deficiencies; and consolidate the achievements of market supervision reform, providing a legal basis for deepening reforms.
The achievements of building a unified national market
Significant progress has been made in unifying systems and rules.
During the 14th Five-Year Plan period, the state continued to improve the basic market system, issuing a number of policy documents to clarify the direction of work and regulatory requirements. A unified market access system was implemented, and the "Negative List for Market Access (2025 Edition)" reduced the number of items and management measures, implementing a "one national list" management model. A campaign to clean up and rectify market access barriers was launched, revising or abolishing a large number of illegal documents and regulations, curbing local protectionism and market segmentation. Anti-monopoly and anti-unfair competition efforts were strengthened, with typical cases being regularly publicized to create a strong deterrent and positive guidance.
The reform of market-oriented allocation of factors of production is accelerating.
Regarding land, the reform of allowing rural collective-owned commercial construction land to enter the market has been accelerated across the board, and the confirmation, registration, and issuance of certificates for integrated housing and land homesteads have been expedited. Regarding labor, the reform of the household registration system has been deepened, with restrictions on household registration in cities with a permanent urban population of less than 3 million basically eliminated, and the points-based household registration policy in megacities and super-large cities optimized. Regarding technology, the reform of scientific and technological achievements transformation has been steadily promoted, and various regions have introduced targeted policies. Regarding data, the "Eastern Data, Western Computing" project has been implemented in depth, and a national integrated public data resource registration system has been basically established. These measures have reduced the institutional costs of cross-regional and cross-industry flow of factors of production and improved the efficiency of factor allocation.
A pattern of coordinated regional development is gradually taking shape.
Driven by a unified national market, regions are shifting from individual efforts to complementary advantages and collaborative division of labor. High-end manufacturing, the digital economy, and R&D-intensive industries are clustering in first-tier and new first-tier cities, such as the "Guangzhou-Shenzhen-Zhuhai" three-core linkage pattern in Guangdong Province's low-altitude economy. Standardized manufacturing, supporting processing, and some productive service industries are shifting to the central and western regions and cities on the periphery of metropolitan areas, forming a tiered division of labor system of "core R&D + peripheral manufacturing," such as Gansu Province undertaking industrial transfers from the eastern and central regions and forming distinctive industrial clusters. Cities that are transportation hubs, national logistics nodes, and cities along cross-regional industrial channels are growing into new regional growth poles, such as Zhengzhou, which has significantly increased its total import and export volume and enterprise activity by leveraging its transportation hub advantages.
Future Prospects for the Construction of a Unified National Market
The basic framework for building a unified national market has been established. The next stage will focus on "establishing rules, facilitating circulation, and optimizing the ecosystem," constructing a long-term mechanism. As reforms progress, local protectionism and market segmentation are manifesting as more subtle barriers. The fundamental solution is to promote a shift from superficial uniformity to deep-seated consistency in rules. The "Regulations on the Construction of a Unified National Market" should be expedited, elevating the "five unifications and one openness" to a higher level and more rigid legal norm. To address obstacles in the market-based allocation of factors of production, institutional openness and rule unification should be the driving force, promoting the nationwide replication of the pilot reforms' achievements in market-based allocation of factors of production and the implementation of long-term mechanisms. Regarding regional coordinated development, efforts should continue to address issues such as "involutionary" competition, encouraging regions to further leverage their comparative advantages, achieve more efficient division of labor and cooperation, and ultimately build a highly efficient, standardized, fair, competitive, and fully open unified national market, providing solid support for China's high-quality economic development.