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China to Attain SOE Reform Target by Year-End: Experts
Most of China's loss-making large and medium-sized State-owned enterprises are expected to get out of difficulties by the end of this year.
This is a view shared by senior Chinese researchers attending the "Dialogue on Business-China 2000" forum. The theme of the forum, which concluded here Thursday, was "Leadership Challenges in a Global Economy".
Most of the SOEs are hopefully to turn loss into profit, and the majority of key industrial sectors will have brighter business prospects after the reform target is achieved, said Wang Zhongming, deputy director of the Economic Research Center of the State Economic and Trade Commission.
In the first three quarters of this year, State-owned enterprises generated 160.9 billion yuan in profits, 2.7 times of those in the same period last year. At the same time, the SOEs in the red cut losses by a remarkable 13.2 percent.
Cheng Xiusheng, director of the Enterprise Institute under the State Council Development Research Center, said that less government intervention in the operation of SOEs has contributed to the SOEs' upbeat performance.
He said that the government has optimized the deployment of state-owned capital through letting SOEs go public and installing new corporate management systems.
In order to reverse the trend of losses in SOEs, the Chinese government decided to deepen the SOE reform in 1998 and set the target of cutting the red tape in major SOEs within three years.
Since then, the government has adopted a series of reform measures, including setting up social security funds for the unemployed, the retired and disadvantaged groups.
Cheng said that the turn-around of the SOEs scheduled for the end of this year will lay a solid foundation for Chinese enterprises to meet the challenges to be posed by China's accession to the World Trade Organization (WTO).
China hopes to initially build a modern corporate system into the majority of its large and medium-sized SOEs at the turn of the century. The experts voiced the confidence that China is capable of pulling most of the loss-making SOEs out of their dire predicament.
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