(Bloomberg) -- China started drafting a law to promote the development of the private sector economy, in the latest attempt by the Asian nation to recharge confidence.

The law will focus on the “core concerns” of private companies, including protecting their property rights, guaranteeing the interests of entrepreneurs, and managing missed payments for small- and medium-sized enterprises, China’s state broadcaster CCTV reported on Wednesday. 

The move marks the latest attempt by the world’s second-largest economy to boost sentiment among private businesses. Their confidence has been rocked in recent years by heavy and sudden regulation of sectors from real estate to video games and school tutoring, which are dominated by privately owned companies.

The law aims to ensure that policy implementation is stable and consistent, motivate businesses to innovate, and enforce rules so that state-owned and private companies are treated equally, CCTV added. 

Authorities vowed to speed up the legislative process for the law, the outlet reported, citing a meeting by the nation’s top economic planning agency, the justice ministry and the national parliament’s legislative affairs commission.

The private sector produces more than 60% of China’s gross domestic product and accounts for more than 80% of urban jobs.

“Materially strengthening legal protections for private business and the other reforms discussed at the meeting could help boost the economy and promote confidence,” said Sean Stein, chair of the American Chamber of Commerce in China. He added, though, that businesses and consumers won’t “boost spending, or increase investment because of a meeting. The positive reaction will only come after the reforms are in place, not before.”

China’s ruling Communist Party in July introduced a 31-point plan aimed at supporting the private economy. The top economic planning agency, the National Development and Reform Commission, in September created a new department aimed at solving the private sector’s problems. But both measures have done little to turn around a confidence slump.

A committee under the national parliament in January listed the private sector law as one of 22 items that “are necessary to be legislated.” The NDRC said in a briefing later that month that it will speed up the process for the law. Officials have carried out some preliminary research on the law, local media outlet Yicai reported in January.

“China under Xi recognizes that it needs law to govern a large country with a large population to try to produce compliance with the governing party’s current policy preferences,” said Lester Ross, a Beijing-based partner at law firm WilmerHale.

“Law with at least some power of coercion is needed to assert the principle of equal treatment even if it continues to be poorly implemented,” he added.

--With assistance from Tom Hancock, Lucille Liu and Jill Disis.

(Updates with comment from AmCham China.)

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