China to reduce government's role in economyBeijing cuts list of state giants
By Cary Huang
THE Central Government has adjusted its plan to nurture giant
state-owned enterprises by slashing the number to be created from 200 to
50 in an effort to reduce the government's role in economy, according to
sources.
Vice-Premier Wu Bangguo announced over the weekend that the State
Council had approved a plan aimed at turning up to 50 giant state-owned
enterprises (SOEs) into internationally competitive companies within four
years.
The Central Government previously planned to create up to 200 giant
SOEs and had worked out a list of firms in particular industries to be the
focus of restructuring. However, following market reforms in the past few
years, Beijing has decided that SOEs should withdraw from more business
areas.
The plan is aimed at increasing the competitiveness of Chinese industry
after the mainland's entry into the World Trade Organisation (WTO),
which is scheduled to become official from tomorrow.
Wu made the announcement at a national conference on economic and
trade affairs on Friday night, the official Xinhua News Agency said. ``It is
a must to develop a batch of giant industrial corporations and groups with
strong competitiveness in the international market,'' he said.
Wu did not detail the enterprises to be nurtured, but economic sources said
they would include those in banking, finance, telecommunications, aviation,
transportation, public facilities and strategic industries.
Wu said China had already fostered a group of SOEs which were capable
of competing with their overseas counterparts.
``In sectors such as metallurgy, petrochemicals and telecommunications,
we have our giant companies,'' he said.
The government would also introduce measures to encourage the giant
companies to seek capital in overseas stock markets to expand their
business. It believed overseas listing would also help them improve
corporate management and administration.
WTO rules allow the mainland to provide small subsidies for specific
industries to help enterprises shake off losses.
The government can also allocate funds to support infrastructure projects,
industrial restructuring, and education and scientific research in its
less-developed regions in the west.
Last week, Beijing announced that the state-run television and radio
ministry had set up the nation's biggest media conglomerate, which it hoped
would challenge the world's largest media companies for domestic and
international market share.
The Chinese Radio, TV and Film Group, officially established on Thursday,
includes Chinese media giants such as China Central Television, the
Central People's Broadcasting Station and China Radio International.
Wu,
the vice-premier in charge of state industry, urged further reform but said
this year's SOE reforms had achieved results, with some 460 mergers
being carried out and a number of chronically ailing enterprises declaring
themselves bankrupt.
10 December 2001 / 02:10 AM