The boundary between government and the market remains fuzzy in China, and the regulations and legislation on environmental protection, market competition, labor rights and intellectual property rights protection are comparatively backward.

Enterprises also lack modern corporate governance.

At the same time, China is confronted with two shocks－the decoupling efforts of the United States and the COVID-19 pandemic, which have prompted the government to strengthen its macro-control of the market, along with efforts to improve its market governance and intellectual property rights protection.

Policymakers should realize that now that the country has harvested most of its "low-hanging fruits", including its demographic dividend, low factor costs such as land, industrialization, infrastructure construction and urbanization, if it cannot foster true entrepreneurship by giving full play to the role of the market and the rule of law, its pro-innovation efforts and the efficiency-oriented development it pursues will be hard to come by.

China is in urgent need of entrepreneurship, which stands for the spirit of adventure, creative efforts and craftsmanship, to boost its economic transformation.

The current level of low-quality competition in China leaves huge room for improvement and the innovation for enterprises, but entrepreneurs need to adapt to the new environment and make changes more quickly. China still needs to go through a cycle of "creative destruction" in which entrepreneurs introduce large-scale innovations that eliminate old technologies and production systems, and establish new ones. This is a cyclical process.

This kind of "creative destruction" is not price competition, but valuable competition that creates new products, new technologies and new models.

China's current low-quality competition has left companies with huge room for improvement and innovation. Unlike the United States, which emphasizes innovation and an adventurous spirit, developed countries such as Germany and Japan pay more attention to the "craftsmanship spirit" of entrepreneurs, which is also a form of entrepreneurship, but with the focus on perseverance, and dedication to innovations that achieve the best products, so as to obtain global competitiveness, which is different from the spirit of adventure.

It is not difficult to see that Chinese companies in all industries currently need both the spirit of adventure and innovative craftsmanship to enhance their core competitiveness.