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Institutions Linked to Market
China will continue its efforts to transform cash-strapped scientific and technological institutions, previously government-funded sectors, into financially independent businesses in its drive to link the institutions with the market-based economy.
"All the application and science-linked institutions attached to the central and regional governments will be reshuffled into market-oriented business companies in the next several years," said Zhang Ju, executive director of the decision-making consultancy office under the Ministry of Science and Technology.
The move is believed to be a continuation of China's efforts to transform its 242 institutions attached to the 10 central ministries to market-oriented business companies. The measures, which began in 1998, are seen as a concrete step in streamlining the country's overstuffed government.
Prior to the re-organization, China's research and development institutions were separated from market demands and fierce competition.
The transformation of the 242 firms, which was finished before the end of last year, has proven successful and most transformed companies have turned into profit-making businesses, said Zhang.
Five firms have public flotations in the stock market, and more than 10 companies are waiting for the evaluation proposed by the China Securities Regulatory Committee - the watchdog of China's stock market - for final approval of listing in the country's equity market.
Speaking at a high-profile conference yesterday aimed at the financing and development of high-tech industries in the Chinese market, Zhang said the country will give preferential treatment to these companies to encourage their business growth.
"Those newly transformed companies will enjoy easier and better chances for public listing in the stock market," said Zhang.
There are still over 6,000 such institutions nationwide of various levels waiting for business re-organization.
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