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Friday, January 21, 2000, updated at 20:21(GMT+8)
Business Beijing Plans Stock Option Contracts with More SOE Managers

The Beijing municipal government is to introduce stock option contracts on a trial basis to more state-owned enterprises (SOEs) this year, Mayor Liu Qi said recently.

According to Liu, ten more high-tech companies, key enterprises and listed companies in Beijing will be selected this year for the stock option contract experiment, a means the government sees will help streamline SOEs of the Chinese capital.

Under the contract, SOE managers will obtain a certain amount of stocks on installments at an agreed price during their tenure and get returns two years after they leave their posts.

Only after the managers' performance is assessed as up to agreed standards can they cash their stocks, according to Zhang Xianping, a city official in charge of the experiment.

The municipal government last year selected ten companies as the first group of SOEs to try the new reform measure. They are now either busy with management system transformation or working to draft details for carrying out the experiment, Zhang said.

The result of the reform measure is yet to been seen.

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