China to help SOEs go public by injecting funds

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Last updated at: (Beijing Time) Friday, March 26, 2004

China to help SOEs go public by injecting funds

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The supervisory agency of China's state-owned assets will withdraw capital from certain sectors and inject the withdrawn assets into some state-owned enterprises (SOEs), in order to speed up their steps of going public.

Bai Yingzi, official in charge of SOE reform with the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), made the remarks during an interview with Xinhua Friday.

Going public was proved an effective way for SOE reform, but capital shortage increasingly became an obstacle for the SOEs' listing on the stock market, especially for those enterprises witha longer history, Bai said.

SASAC has no income from its SOE administration before the operational budget system is established. Only by retreating from certain industries can SASAC invest more into the key sectors concerning the nation's security and economic development, which is the State Council's requirement for SASAC.

This year, SASAC will began to inject capital obtained by withdrawing assets from certain sectors to some SOEs to help them go public, Bai said.

About 180 SOEs under SASAC supervision differ tremendously in scale and performance. For the first six enterprises, their sales income accounts for 43 percent of that of all the SOEs, and their profit accounts for 70 percent of the total SOE profit.

Therefore, SASAC Director Li Rongrong reiterated that promoting SOE regrouping and listing on the stock market was, and would still be, one of SASAC's major tasks.

Source: Xinhua

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