See More on Facebook

Economics

Beijing wont play favourites with state-owned enterprizes

Beijing vows to stick to neutrality in dealing with state-owned enterprises.


Written by

Updated: October 16, 2018

China will maintain its neutral stance for market competition and offer companies of all categories of ownership a level playing ground, the regulator of China’s State-owned assets and enterprises said on Monday.

Peng Huagang, the spokesman for the State-owned Assets Supervision and Administration Commission, said the target of the country’s State-owned enterprises reform and reshuffling is to turn SOEs into independent entities that are truly self-managed, self-disciplined and able to assume full responsibility for their own profits and losses.

Peng was responding to recent media speculation that some giant SOEs are taking advantage of difficulties experienced by some listed private companies by acquiring or merging with them at bargain prices.

Some media have claimed that SOEs are expanding while private firms are shrinking.

“SOEs have no intention to acquire or merge with listed private companies in a fair market environment regardless of the circumstances,” Peng said at a Beijing news conference.

“Instead, a total of 2,618 SOEs such as Shanghai Baosteel Gases Co, have transferred the majority ownership to private companies under the policy guide in recent years,” Peng added.

He said that the government will also remain neutral toward companies of all categories of ownership, standing against the practice of applying different rules for companies of different ownership.

China also is against the idea of discriminatory restrictions on SOEs and supports the principle of competitive neutrality, Peng said.

According to the Organization for Economic Cooperation and Development, competitive neutrality means that state-owned and private businesses compete on a level playing field.

This is essential for the effective use of resources within the economy and therefore the achievement of growth and development.

While the principle of competitive neutrality is gaining wide support around the world, obtaining it in practice is a much more difficult question, said analysts.

Xiang Anbo, a researcher of enterprise development at the Development Research Center of the State Council, noted China’s economic policy transformation from emphasizing industrial policy to focusing on competitive policy.

During this process, the government has already begun to push forward substantive reform in its SOEs to adapt to the new policy environment and take the initiative to become compatible with the regulation of competition policy, Xiang said.

Also, the competition policy should take into account that China has a large number of State capital investment and operating companies, and the country should hold the principle of competitive neutrality, provide adequate room for the performance of SOEs and enable them to play a positive role, Xiang added.

Yi Gang, governor of the People’s Bank of China, the central bank, said the country is considering promoting SOE reform based on the competitive neutrality principle. He made the comment at the annual International Banking Seminar of the Group of Thirty on Sunday in Bali, Indonesia. The group is an international body of leading financiers and academics.

For the next step, China will accelerate reforms and opening-up to solve the structural issues in its economy, as well as enhance intellectual property protection, Yi said, adding that the country will further promote the opening of the service industry, including that of the financial sector.

The State-owned Assets Supervision and Administration Commision said profit growth in China’s centrally administered SOEs accelerated in this year’s first three quarters.

Combined profits reached 1.35 trillion yuan ($195 billion) between January and September, up 21.5 percent year-on-year, while their cumulative business revenue rose 11 percent year-on-year to about 21.1 trillion yuan, about 0.9 percentage point higher than the growth rate of the first half of 2018.

The growth figures show that China’s central SOEs have moved to meet the requirements of the competition policy to optimize overall economic efficiency and maximize social welfare, said Li Jin, chief researcher at the China Enterprise Research Institute. “In the long term, they will continue to focus on capital management and mixed-ownership reform to further improve their earning ability.”

Among financial indicators for central SOEs also released on Monday were a further drop in debt-asset ratios, vigorous fixed-asset investments and an upsurge in cash flow.



Enjoyed this story? Share it.


China Daily
About the Author: China Daily covers domestic and world news through nine print editions and digital media worldwide.

Eastern Briefings

All you need to know about Asia


Our Eastern Briefings Newsletter presents curated stories from 22 Asian newspapers from South, Southeast and Northeast Asia.

Sign up and stay updated with the latest news.



By providing us with your email address, you agree to our Privacy Policy and Terms of Service.

View Today's Newsletter Here

Economics

Chinese court grants Qualcomm an injunction against Apple

The injunction bans the sale of several models of IPhones in China. Qualcomm Inc on Monday said it had won a preliminary order from a Chinese court banning the importation and sale of several Apple Inc iPhone models in China that the court found violated two of Qualcomm’s patents. The preliminary order affects the iPhone 6S through the iPhone X. The ruling is from the Fuzhou Intermediate People’s Court in China, the same court that earlier this year banned the import of some memory chips by Micron Technology Inc into China. Qualcomm initially filed the case in China in late 2017. Apple is already disputing the scope of the ban, saying it only applies to iPhones that run on an older operating system. “Qualcomm’s effort to ban our products is another desperate move by a company whose illegal practices are under investigation by regulators around the world,” Apple said in a sta


By China Daily
December 12, 2018

Economics

China-US trade dispute enters second half

Despite a temporary truce in the trade war, much work still needs to be done. China and the United States reached a consensus to suspend tariff hikes and restart trade talks at the meeting between President Xi Jinping and his US counterpart Donald Trump in Argentina on Dec 1. Yet the Canadian police detained Meng Wanzhou, Huawei’s global chief financial officer, and could deport her to the United States where she could face charges for evading US curbs on trade with Iran. These contrasting signals show the complexity of China-US trade conflict, and since the conflict has reached a critical stage, four major changes can be expected. From a blitz to protracted standoff First, the trade conflict between the two largest economies has shifted from being a blitz to a stalemate. The first half of the game, which has stretched from March to November, can be seen as a fight for time


By China Daily
December 11, 2018

Economics

Malaysia to charge ex-prime minister and fund chief over audit tampering

Najib and Arul Kanda will be indicted on Wednesday by prosecutors. Graft prosecutors are set to charge Najib Razak and former 1MDB president Arul Kanda Kandasamy on Wednesday over the tampering of the company’s final audit report. Sources said that the former prime minister will be charged with using his position to instruct the then Auditor-General to remove “certain things” from the report. Arul Kanda will be charged with abetting Najib. The two are expected to be charged at the Kuala Lumpur Sessions Court. She revealed that the directive to make the changes came from Tan Sri Shukry Salleh, who was then the principal private secretary to Najib when he was prime minister. The changes were allegedly made on Feb 26, 2016 on grounds that it was a sensitive issue.  


By The Star
December 11, 2018

Economics

UK court orders tycoon’s extradition to India

Vijay Mallya can be extradited back to India, a UK court rules. A London court on Monday ordered extradition of liquor baron Vijay Mallya to India, where the now defunct Kingfisher Airlines boss is wanted for alleged in financial irregularities and loan default ammounting to over $1 billion US Dollars. The Vijay Mallya extradition case has been referred to UK Secretary of State Sajid Javid, who will pass an order based on the verdict. In a setback to Mallya, Westminster Magistrates’ Court Chief Magistrate Judge Emma Arbuthnot ruled that that there was “no sign of a false case being mounted against him”, adding he could be extradited to India to stand trial on the charges brought by the Central Bureau of Investigation and the Enforcement Department, a PTI report said. “Having considered evidence as a whole.


By The Statesman
December 11, 2018

Economics

Ghosn charged with falsifying reports

Ghosn and an associated remain in jail on charges of tax avoidance and falsifying reports. Carlos Ghosn, former chairman of Nissan Motor Co., his aide Greg Kelly, former representative director of Nissan, and the automaker itself were charged on Monday with falsifying the firm’s securities reports. Also on Monday, Ghosn, 64, and Kelly, 62, were rearrested by the special investigation squad of the Tokyo District Public Prosecutors Office on suspicion of underreporting more of Ghosn’s income. Ghosn and Kelly were initially arrested on Nov. 19 on suspicion of violating the law by allegedly conspiring to underreport Ghosn’s executive remuneration in the company’s securities reports by a total of about ¥5 billion from the business year ending March 2011 to that ending March 2015. Prosecutors believe the actual amount of his pay was about ¥10 billion. The pair denied the allegations during qu


By The Japan News
December 11, 2018

Economics

Huawei exec’s arrest: Who is Meng Wanzhou?

Huawei CFO arrest threatens fragile trade war truce. When news broke on Thursday (Dec 6) that a top Huawei executive has been arrested in Canada, Ms Meng Wanzhou became one of the most talked-about persons in online chatter and social media chat groups. Born in 1972, Ms Meng, who also goes by Sabrina Meng and Cathy Meng, is the chief financial officer of Huawei, the world’s largest telecommunications equipment supplier and the world’s No. 2 seller of mobile phones. She was detained by the Canadian authorities in Vancouver on Dec 1 while in transit and is facing an extradition request from the United States. Various reports indicated that this could be related to violations of US sanctions on Iran. The South China Morning Post said that Ms Meng has spoken to Huawei staff in a recent internal briefing on regulatory compliance. She had said that there may be cases where &#


By The Straits Times
December 7, 2018