Listed Companies: Economic Backbone of Ethnic MinoritiesIt took some getting used to, but now Chinese are accustomed to seeing TV commercials produced by companies based in China's ethnic minority areas."Advertisement sometimes reflects the economic development standard in a certain region," said Pan Zhaodong, a noted economist specializing in ethnic minority research. Though these companies were seldom seen on China's leading TV stations a decade ago, they have now become the economic backbone of China's ethnic minority areas. Growing from a relatively backward economic base due to their isolated geological location and underdeveloped infrastructure foundation, firms that originated in ethnic minority regions have now actively participated in China's stock market with powerful competitiveness. Among the more than 1,090 listed companies in China's stock market, 75 come from China's five remote autonomous regions, including Tibet, Xinjiang Uygur, Guangxi Zhuang, Ningxia Hui and Inner Mongolia, which are all settlement of ethnic minority groups. They have raised some 30 billion yuan (3.6 billion U.S. dollars) on the stock market and are becoming more popular than ever among Chinese shareholders for the strong and reliable economic performance. Twenty listed companies in the Inner Mongolia Autonomous Region, for instance, reported to have an average profit rate of 26 percent in their main operations and returns of over 10 percent on their net assets, respectively, last year. Both of the two indicators were higher than all the listed companies' average level, official sources show. Companies spread in China's ethnic minority regions, usually less-developed areas, used to suffer from many intrinsic problems like lax administration and insufficient capital investment, said Chu Yongshan, official under a branch of China Securities Regulatory Commission (CSRC) in Hohhot, capital city of Inner Mongolia Autonomous Region. But rational distribution of productive forces in recent years, strong governmental support along with the current bold and resolute west development drive which has created new development opportunities, have jointly stimulated a drastic growth momentum for these listed companies. Once considered unimpressive, they are taking great efforts to build themselves into modern enterprises and have shed their backward image, Pan, the economist, said. Inner Mongolia Yili Industrial Group Company Limited, now a dairy giant in China, had just 410,000 yuan (nearly 50,000 U.S. dollars) in fixed assets ten years ago. Listed on the stock market in 1996, Yili's current fixed asset has rocketed to some 1.6 billion yuan (nearly 193 million U.S. dollars) making it China's biggest tax-payer in the dairy industry. Yili consistently launched comprehensive reforms over the years, including purchasing several other dairy plants in northern China, initiating technological innovation, introducing advanced equipment from Germany, Sweden and Norway and adopting modern management practices so as to make itself more appealing to the world market. Listed companies not only guide the direction of local economic development, but also stimulate confidence in other less-developed enterprises, Pan added. Average asset scale and output value of all the 19 listed companies in Xinjiang Uygur Autonomous Region are 12 times and 14 times, respectively, of those Stated-owned enterprises based in the region. Eight listed Tibetan companies, which have raised some two billion yuan (241 million U.S. dollars) on the stock market, are also operating as the leading force of the local economy. Most of such listed companies operate in traditional industries of farming, construction materials, chemical industry and some other sectors that largely rely on natural resources. Some of them, however, are extending to the high-tech industries like biotechnology, network building and micro-electronics. |
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