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 | Monday, April 17, 2000, updated at 09:46(GMT+8) | ||||||||||||
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China to Liquidate State Assets for Pension FundsChina could raise billions of yuan by liquidating some State assets to finance its huge shortfall in pension funding and a government source warned that failure to do so could threaten the country's pension system.A variety of measures could be employed, including redeeming State-held shares in listed companies and charging for the previously free use of land, to raise funds to support a sounder pension system, according to a report by the State Council Office for Economic Restructuring. The Chinese Government needs at least 1.8 trillion yuan ( about 217 billion US dollars), which was the most optimistic scenario, to repay debts owned under the old pension system. China implemented a new pension system three years ago that established individual pension accounts for active workers in State enterprises, to be contributed monthly by both workers and employers. But that left a gaping need for pension funds for workers retired or hired before 1997 who expect equal treatment. A huge pension deficit has already resulted in siphoning as much as 100 billion yuan (about 12 billion US dollars) from individual pension accounts to balance the pension system's budget in 1999, statistics from the Ministry of Labor and Social Security indicated. The report said that the sale of shares held by the State in listed companies on the Shanghai and Shenzhen stock markets alone could raise as much as 220 billion yuan (about 26.5 billion US dollars).
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