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Laying Solid Foundation for Cross-century SOE Development
Since the beginning of this year, smooth progress has been made in the reform of State-owned enterprises (SOEs) and getting them out of difficulties, a record high level has been achieved in economic efficiency, achievement of the goal set by the Party Central Committee for the SOE reform and elimination of difficulties in three years has been in sight, the situation is encouraging.
In the face of this favorable situation, it should also be noticed that to seize final victory in the decisive battle, we still face many difficulties, we should reinforce our confidence and redouble our efforts. At the same time, we should get a better understanding of the protracted nature, arduousness and complexity of SOE reform and development. We should make strenuous efforts to get an overall solution of some deep-seated contradictions and problems existing in State-owned enterprises, thereby laying a solid foundation for the cross-century reform and development of State-owned firms.
To maintain the sustained and sound SOE development, we should first realize that fulfillment of the task of reforming SOEs and lifting them out of difficulties in three years is only a phased target, in practical work, we should combine the phased target of realizing SOE reform and development with long-range objective. At present, the achievements gained in reforming SOEs and eliminating their difficulties have laid an important foundation for the cross-century development of these enterprises, but in the face of achievements, we must not be blindly optimistic and take things lightly, we must not slacken off in the slightest. We should fully understand that we still have a long way to go before we can really set up a modern enterprise system and we still face many contradictions and problems in our endeavor to successfully run SOEs as a whole. For instance, problems, such as inactive mechanism, overstaff and excessive debts long existing in State-owned enterprises, have not been fundamentally solved; enterprise innovative, competitive and risk-resistant capabilities are still rather weak; the irrationality of economic structure and insufficiency of effective demand have great influence on enhancement of enterprise efficiency, and it needs a process for solving these problems; with China's projected accession to the World Trade Organization (WTO), Chinese enterprises will face more intense international competition. If we fail to have a clear understanding of the situation and base ourselves on long-term development, the already existing favorable situation could not last long.
To maintain the sustained and sound SOE development, we should establish a correct conception of efficiency. Efficiency is a reflection of the comprehensive qualities of an enterprise. Efficiency must be real and solid. Since the beginning of this year, various trades and professions and various regions have witnessed a substantial rise in their economic benefits, the overall efficiency of industry has reached an all-time high, in the face of such a favorable situation, it is particularly necessary to emphasize that unrealistic compare and exaggerated efficiency are no good. Enhancement of efficiency is important, but it is more important to maintain and increase the rear strength for enterprise development. Enhancement in enterprise efficiency must be based on freedom of outstanding accounts, for example, depreciation, interest on loans, expenses for technological development, tax money, old-age pension for retirees should be sufficiently drawn, cleared and paid fully where they should. Only such profit-making enterprises can be regarded as genuine profitable enterprises. Those enterprises which feel it "honored" to fulfill temporary profit index and so "go in for profit" will be unable to withstand market tests.
To maintain the sustained and sound development of State-owned enterprises, it is necessary both to constantly improve the conditions of macro-environment and for the enterprise to make unremitting efforts. In recent years, the State has published a series of policies and measures to support enterprise reform and development, such as controlling economic aggregate, readjusting economic structure, reducing enterprise debts and social burden, supporting enterprise's accelerated technological progress and encouraging expansion of exports, these policies have long-term influence on SOE reform and development. As these policies being gradually implemented and put in place, their effects will be further shown, the overall qualities of State-owned enterprises will be further improved. At the same time, it should be realized that State policies supporting enterprise reform and development have been basically published, in the future, it would be unrealistic for enterprises to place too much dependence on State policies to support their development and enhancement of efficiency. In the face of the ever-fiercer market competition, enterprises should turn their eyes inward, devote efforts to accelerating the establishment of a modern enterprise system, constantly think hard to raise their management level, strive to deepen reforms of internal labor, personnel and distribution systems, and muster their courage to be in the van to speed up technological progress and develop new products. The Shanghai Baoshan Iron and Steel Group Company, the Northeast Pharmaceutical Factory, the Qingjiang Hydropower Plant, the Anyang Color Picture Tubes Works and Qingdao Haixin Group, jointly recommended this time by the Publicity Department of CPC Central Committee and the State Economic and Trade Commission, have scored very good achievements in these aspects, and their experiences deserve to be learned from and drawn on by others in light of their own realities.
The new century is upcoming, and a new Five-year Plan for China's national economy will soon begin. So long as the higher and lower levels work with concerted efforts, properly implement the policies of the Party Central Committee and the State Council, go all out and do pioneering work, we will certainly be able to seize victory in the decisive battle for reforming State-owned enterprises and lifting them out of difficulties in three years, thereby laying a firm foundation for the cross-century SOE reform and development and making still greater contributions to the sustained, rapid and sound development of the national economy.
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