This article, the second in the series on conscientious implementation of the spirit of the Central Economic Working Conference, is written by the Liaoning provincial Party committee and Liaoning provincial people's government. the article runs in part as follows:

The recent Central Economic Working Conference, an important meeting held at the turn of the century, has helped us further understand the situation, have a clear idea about the tasks and strengthen our confidence.

Liaoning Province has a total of nearly 500 large and medium-sized State-owned enterprises (SOEs), which hold the leading and pillar status in the province's economy. The provincial Party committee and the provincial government have always regarded the successful operation of SOEs as the most important task in the province's economic work. After the objective of accomplishing the reform of SOEs and helping them get out of difficulties in three years was set at the 15th National Congress of the Party and at the First Plenary Session of the 15th CPC Central Committee, we further intensified our work efforts. First, we have persisted in emancipating our minds and changing our concepts, guided cadres and the masses to establish the market concept, development concept and innovative concept and use ideological and conceptual change to promote the reform and development of SOEs. Second, taking establishment of a modern enterprise system as our target, we have further deepened SOE reform. Of the province's large and medium-sized enterprises, 172 units, or 34.6 percent of the total, have realized the reform in line with the corporate system. Third, We have accelerated structural readjustment in accordance with the principle of transforming traditional industries with high and new technologies, developing high and new technological industries and carrying out intensive processing of products. Since the implementation of the Ninth Five-Year Plan, we have started implementtion of major transformation and readjustment of 110 projects, involving total investments of about 80 billion yuan. Fourth, taking advantage of the State policy of increasing capital and reducing burden, we have created a good environment for the reform and development of SOEs. Fifth, adhering to the principle of taking human resource as the foundation, we have strengthened construction of the enterprise leading bodies and relied on the broad masses of workers and staff to run the enterprise well. Since last year, we have made readjustment to 217 managers and directors of large and medium-sized SOEs, optimizing the enterprise leading bodies in terms of age bracket, and specialty and knowledge structures.

Under the leadership and with the help of the Party Central Committee and the State Council and through the unremitting efforts of the cadres and the masses in general, we have, in the year of tackling difficult reform problems, maintained steady economic development and basic social stability. Our province has gained initial results in the reform of SOEs and freeing them from difficulties, almost half of the province's large and medium-sized SOEs have preliminarily attained the goal of ridding themselves of difficulties. Beginning from this June, the province's State-owned industrial enterprises have turned deficit into profit. In the first nine months, the output value of large and medium-sized SOEs was up by 10.72 percent over the same period last year, and the sales value was up by 15.94 percent; compared with last year's same period, the area of loss was down from 53.9 percent to 40.2 percent, and the value of loss from 5.84 billion yuan to 3.2 billion yuan, bringing about a turn from deficits of 3.36 billion yuan to profits of 0.52 billion yuan, putting an end to the situation of net losses for four straight years.

The Fourth Plenary Session of the 15th CPC Central Committee marks a new breakthrough in both theory and practice made by our Party in running SOEs well under the conditions of the market economy and represents a milestone in the development history of China's SOEs. We have called for holding high the great banner of Deng Xiaoping Theory and taking the spirit of the 15th National Congress of the Party and the Fourth Plenary Session of the 15th CPC Central Committee as the guideline and, centered closely around the task of bringing about the two fundamental shifts of the economic system and the mode of economic growth, we have made active exploration, engaged in bold practice, we have persisted in making breakthroughs in reform, ensured innovation in system, technology and management and have made up our minds to fight a decisive battle in accomplishing the task of reform and getting SOEs out of difficulties in three years, thereby opening up a new situation in the reform and development of Liaoning's SOEs. Our target set for the year 2000 is: a modern enterprise system will have been initially set up in most large and medium-sized SOEs, most losing large and medium SOEs will have got out of difficulties, the area of loss will be kept within 25 percent, basically accomplishing the task of reform and freedom of difficulties in three years. We are prepared to focus on doing well four aspects of work.

First, we will readjust the distribution of the State-owned economy, speed up the reorganization of SOEs and promote the optimization and upgrading of the structure of SOEs. Upholding the principle of both going forward and going backward, and getting some things done and other things undone, we will readjust and optimize the distribution of the State-owned economy.

Second, focusing on reform of large and medium-sized SOEs in line with the corporate system, we will strive to realize system innovation. In compliance with the requirement of keeping the capable as the mainstay, separating the secondary factor, engaging in multi-level operation, and exercising management in the manner of group management, we will continue to push forward the endeavor to separate the leading factor from the secondary factor, strive to ensure enterprise's mainstay and capable status, clearly define the parent and subsidiary, or mother and son relationship, cut down the number of redundant workers and improve efficiency. By the end of next year, the work of separating the leading factor from and secondary factor should be completed in the province's large and medium-sized SOEs.

Third, we will readjust the labor employment structure, actively but steadily promote the strategic shift of the surplus labor force of SOEs. Our province has a total of 4.6 million workers and staff of SOEs, of whom 2.56 million are workers of State-owned industrial enterprises, with redundant personnel accounting for over one-third of the total number. Transferring redundant personnel and shifting labor force is a strategic issue affecting the reform and development of the province's SOEs, therefore, an overall program must be made and be incorporated into the national economic and social development plan. Based on development, we should create more job opportunities, realize the shift of labor force from the secondary industry to the tertiary and primary industries, and from State-owned to non-State-owned economies.

Fourth, we will strengthen technological innovation and enhance the competitiveness of SOEs. In Liaoning as an old industrial base, the proportion of traditional industries accounts for over 70 percent. We must conscientiously implement the spirit of the national technological innovation meeting to promote technological upgrading and optimization of the industrial structure. Making full use of the favorable condition of opening to the outside world, and centering around the task of developing and introducing new products, we should strive to improve the quality of existing products and form an economy of scale. We should establish a technological innovation mechanism and an innovative system suited to the development needs of the market economy, we should establish technological development centers in large industrial enterprises, encourage and support large enterprise groups where conditions permit in setting up high-level, comprehensive State-class and provincial-class technological development centers. We should increase input in projects for scientific and technological progress, speed up the establishment of technological risk investment and loan guarantee mechanisms, channel more social capital into technological innovation. We should give play to the superiority of Liaoning with many scientific research institutes, and institutions of higher learning and vigorously promote the association of production, education and research and accelerate the conversion of research results into production.

There is only one year to go before the goal of accomplishing the task of reforming SOEs and getting them out of difficulties in three years, so the task is arduous and the responsibility heavy. We must keep our thinking in identity with the spirit of the Fourth Plenary Session of the 15th CPC Central Committee, display a high sense of political responsibility and a strong enterprising spirit, and unswervingly push SOEs to a new stage of development.