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Formulating a New Model of Coal Market Governance in Beijing, Tianjin and Hebei Province

Jan 18,2017

By Zhou Jianqi, Enterprise Research Institute, DRC

2016-12-13

Abstract: China’s regulation on coal market in Beijing, Tianjin and Hebei Province is focused mainly on government planning. Despite some effects, the “one-size-fits-all” mandatory intervention approach has resulted in many problems and should not be applied for long. Long-term intervention through a planned mode will cause adverse effects to the market, as the coal market in these regions serve as an indispensible part of the international one. The regulation of the coal market is required to follow the general trend of market performance and the proper approach is to replace the administrative regulation focusing on planning with a multilateral participation-based governance model. With the improvement of market system and the transformation of government functions, China is now able to control the coal market in a market-based manner. However, this does not mean to leave everything to the market, but the government needs to adopt a governance model with the participation of various market players and by combing economic, legal and administrative means. The government needs to cultivate a market-oriented platform, encourage various market players to participate in the operation of the platform and establish related supporting mechanism.

Key words: governance of coal industry, market-oriented platform, cooperative governance, Beijing, Tianjin and Hebei Province