Currently, a deep understanding of the "Guidelines for the Construction of a Unified National Market (Trial)" (hereinafter referred to as the "Guidelines") is an important prerequisite for implementing the decisions and deployments of the Party Central Committee and the State Council. Below are four points of understanding. The construction of a unified national market is an inevitable requirement for the high-quality development of China's economy. The government and enterprises are two entities with different functions and interactions in economic development. Enterprises provide goods and services for market transactions, but any economic activity of enterprises cannot be separated from the market environment. As a market environment for public goods, the government is the main provider. In the early stages of reform and opening up, China was transitioning from a planned economy to a market economy. At that time, the number of industrial enterprises was very limited and the ownership structure was relatively simple. In this situation, through administrative decentralization, China has opened up a new economic development model. After the 14th National Congress of the Communist Party of China proposed the establishment of a socialist market economy system, China successively launched the reform of the tax sharing system and a series of other market-oriented reform measures, thereby strengthening the motivation of local governments to develop the economy. This regional competition model has become an important driving force for China's regional economic growth, but it has also led to local protectionism and market segmentation. For example, in the early stages of development when enterprises have not yet fully grown, some local governments simply enter the market directly, acting as both referees and athletes. When in a seller's market with supply shortages, some local governments may compete for projects and resources. After entering the buyer's market, some places may restrict the inflow of external products to protect the local market. With the growth of enterprises and economic development, the unsuitability of this model is becoming increasingly apparent. For example, some large enterprises increasingly require local coordination for cross regional asset integration and restructuring, cross regional layout of upstream and downstream industrial chains, and cross regional cooperation between industry, academia, and research. For example, the industrial homogeneity between regions brought about by local protection and market segmentation, on the one hand, makes it difficult for enterprises to obtain economies of scale and deepen industrial division between regions, and on the other hand, redundant construction also causes resource waste. For example, various regions compete with each other to compete for policy incentives in order to attract investment, leading to bottom line competition, "fat water outflow" and other situations. Under the new normal of promoting high-quality development, it is becoming increasingly urgent to overcome the negative impact of local competition by promoting the construction of a unified national market, in order to adapt to the requirements of new development. The key to promoting a unified national market is to reduce the transaction costs of factor flows. One of the fundamental differences from over 40 years ago is the significant increase in enterprise scale and density today. As of November 2024, the number of registered business entities and enterprises in China is 189 million and 60.867 million respectively, which is equivalent to less than 8 people having 1 business entity and less than 24 people having 1 enterprise. Such market operators and enterprise density exceed the average level of moderately developed economies. The number of Chinese companies in the Fortune Global 500 has increased from 79 in 2012 to 142 in 2023. With the significant increase in market entities and enterprises, especially the rapid growth of large enterprises, the demand for cross regional allocation of resources and production layout is rapidly expanding. This requires a significant reduction in the cost of product, resource, and factor flow to achieve the maximization of enterprise revenue and consumer surplus. Reducing current costs involves three aspects: transportation costs, information costs, and transaction costs. In recent years, the gap between the hardware of public facilities such as roads, transportation, and communication networks in China and the international advanced level has been narrowing. On the one hand, transportation infrastructure is constantly improving, such as roads, transportation, highways, high-speed trains, and subways, which are developing rapidly. On the other hand, 5G has been integrated into 80 national economic categories, "5G+Industrial Internet" covers 41 industrial categories, urban development of gigabit optical network expands network coverage to rural and remote areas, and some communication facilities have reached the world's leading level. With the significant improvement of hardware facilities, the consumer oriented online product market and e-commerce platforms have developed rapidly, accelerating the formation of a national product market network from online transactions of agricultural products, daily industrial supplies, and durable consumer goods. However, due to the dual constraints of factor specificity, non standardized characteristics, and regional rule differences (covering factors such as capital, land, manpower, technology, data, etc.), factor flow is still far from as smooth as online transactions of products. Therefore, connecting data, aligning rules, eliminating various artificial implicit constraints, and thus breaking through the bottlenecks and bottlenecks in the free flow of factors are the key to improving resource allocation efficiency. Taking the internationally recognized ratio of total social logistics costs to GDP as an example, in 2024, the ratio of total social logistics costs to GDP in China will be 14.1%, while in developed countries it is generally between 8% and 9%. Where is the space to reduce the overall logistics cost of society? Although there is still room for improvement in hardware infrastructure such as roads, transportation, and communication, cross regional and cross departmental systematic collaboration as a "software facility" construction is becoming a new breakthrough in reducing logistics costs. This institutional synergy can effectively reduce transaction costs caused by information asymmetry by reducing regional barriers and administrative divisions, thus forming a more sustainable cost reduction path. It is worth mentioning that the transaction cost referred to here includes two layers of meaning. The first is the cost incurred in transactions between operators, such as inquiry, negotiation, negotiation, and the execution, supervision, and default risks after contract signing. The second is the transaction costs caused by the system and policies, namely institutional transaction costs. At present, reducing institutional transaction costs has become a key task in building a unified national market. On the one hand, it is the basis for the costs incurred in transactions between operators. For example, cross regional property disputes may result in significant differences in the cost of corporate rights protection due to differences in judicial procedures. On the other hand, with the improvement of hardware facilities such as transportation and information, institutional barriers and contradictions may become more apparent. The main manifestations include repeated approvals in cross regional operations, regional exclusive clauses in bidding and procurement, and implicit costs such as arbitrary fines. As explicitly stated in the Guidelines, no region or department shall illegally limit or designate specific patents, trademarks, brands, components, origins, or suppliers in bidding and government procurement, illegally set qualifications, technical, or commercial conditions that do not match the specific characteristics and actual needs of the bidding and procurement project, illegally limit the location, organizational form, or ownership form of bidders, or set other unreasonable conditions to exclude or restrict operators from participating in bidding and procurement activities. From this perspective, breaking down these non market barriers is one of the important breakthroughs in improving the efficiency of the national market operation. The mechanism for reshaping the role of local governments in promoting the construction of a unified national market has undergone more than ten years of administrative management system and process reforms with a focus on optimizing the business environment. Various provinces and cities have made significant progress in enterprise registration, payment and cancellation, as well as property rights registration and protection. China's business environment has risen from 96th place in 2013 to 31st place in 2022 globally. Through continuous optimization of the business environment, various provinces and cities are gradually converging in terms of work efficiency, process simplification, and service standards. The Guidelines propose the "Five Unifications" and "One Elimination", which means that the rules and policies of the business environment will further move towards standardization. The establishment of these standards is a symbol of the formation of a unified national market. Does the convergence of business environment rules and policies in different regions mean that the space for local governments to act has shrunk? I thought this was a change in the underlying mechanism of local government. The underlying mechanism referred to here refers to the development model in which local governments in the past provided explicit or implicit subsidies and other preferential policies in regional competition to attract external resources and promote local economic growth. The Decision of the Third Plenary Session of the 20th Central Committee of the Communist Party of China proposes to standardize the regulations and systems for local investment promotion, and strictly prohibit illegal and irregular policy incentives. The construction guidance of the "Guidelines" clearly states that it is not allowed for regions to compete in this way of comparison again. In the absence of a change in the goal orientation of local governments pursuing local economic growth and fiscal revenue growth, local competition exists, but the means of competition for growth in various regions need to be transferred to providing high-quality public services such as technology, professionalism, and business for the development of local new quality productivity. For example, formulating plans to strengthen emerging industries, layout future industries, and enhance traditional industries, establishing innovation and development funds, building common technology service platforms, increasing basic innovation investment, and formulating incentive policies for innovation. By improving the service system for innovation and industrial development, enhancing the supporting capacity of public service facilities, and improving the quality of public services, we aim to enhance the attractiveness of investment attraction. In this situation, where high-quality common technology service platforms, innovative achievements industrialization supporting and service capabilities, and support systems are first formed, there will be more innovative elements flowing in and innovative enterprises gathering. To give full play to the pioneering role of the Guangdong Hong Kong Macao Greater Bay Area in the construction of a unified national market, it is necessary to promote the unification of rules and standards between regions in five aspects, as well as to connect with internationally recognized market rules. As one of the regions with the highest level of openness to the outside world in China, the Guangdong Hong Kong Macao Greater Bay Area has the advantage of exploring the construction of a unified national market under a high-level institutional opening-up framework. Its unique institutional framework of "one country, two systems, three tariff zones, and three currencies" constitutes a unique foundation that other regional market integration processes in China do not possess. This particularity determines that the market integration construction of the Guangdong Hong Kong Macao Greater Bay Area presents a dual dimension: on the one hand, it needs to achieve unified rules and standards among the nine cities in the Pearl River Delta, and on the other hand, it needs to achieve deep integration with the institutional system of Hong Kong and Macao. Compared to market integration that simply deals with regional differences within the country, the Guangdong Hong Kong Macao Greater Bay Area not only needs to break down institutional barriers across systems, but also coordinate the collaborative innovation of internal and external rules, essentially carrying the dual mission of domestic market unification and international rule docking. In fact, since the implementation of the "Outline Development Plan for the Guangdong Hong Kong Macao Greater Bay Area", the Greater Bay Area has achieved significant results in effectively connecting government services, investment and trade, market access, qualification certification, and other aspects in "one matter, three places, one policy, three places, and one regulation, three places". These explorations have played an important demonstration role in promoting the construction of a unified national market under a high-level open system. At present, China not only comprehensively benchmarks international high standard economic and trade rules, further promotes high-level institutional opening, but also actively promotes the construction of a unified national market. The Guangdong Hong Kong Macao Greater Bay Area, which combines these two aspects, continues to deepen and expand in terms of rules, standards, and mutual authentication, undoubtedly has important pioneering exploration significance. Wang Jun, former president and professor of Guangdong Academy of Social Sciences