Nearly 1000 SOEs Drop out of Market in Past Three Years

Almost 1000 large and medium-sized state-owned enterprises (SOEs) have withdrawn from the market by way of going bankrupt or being closed over the past three years, said Shao Ning, director of the enterprise reform bureau under the State Economic and Trade Commission at the on-going Second Summit of Shareholding Entrepreneur.

As learned from among those SOEs, 20 or 30 of them have over 10 thousand employees, which include Benxi Mining Bureau with around 54 thousand staffs and workers and Guizhou Liuzhi Mining Bureau having an employment of 29.9 thousand.

A number of enterprises have suffered serious losses and are not able to make both ends meet due to large amounts of administrative investment and pursuit of political fame by local officials. Such enterprises fall into following two types: first, mining enterprises with exhausting resources, that usually have many employees as over scores of thousand and large family burdens of over 100 thousand located in mining areas with a poor digestion capacity. Secondly, enterprises in military industry, few of such enterprises can carry out normal production for military-related products are not in great needs now, and even if those enterprises were transferred into that for turning out products for civilian use, they still could not eke out their existences.

Besides the large sum of compensation fund, social stability should be taken into consideration in dealing with their withdrawal and this needs an overall planning and organization, as well as participation and cooperation of various departments concerned, said Shao.

The dropout of these enterprises may cause a short-term bad influence, but in the long run, it helps ward off big troubles endangering social development and stability, thus preventing the country from suffering more losses, said Shao.

By PD Online staff member Li Yan

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