Since the Chinese Government launched its ambition to reform the nation's economic system and business management model in 1978, the vigor of state-owned enterprises (SOEs) has been constantly unleashed and strengthened. As the State Council unveiled a guideline to further SOE reform last September, an additional round of profound changes seems forthcoming.
On February 25, the State-owned Assets Supervision and Administration Commission of the State Council (SASAC) declared to initiate 10 reform pilots. The measures include underpinning the function and power of the SOEs' board of directors, recruiting and selecting managers in a market-oriented way, propelling mergers and acquisitions of enterprises under the supervision of the Central Government, and advancing mixed ownership reform, etc.
These pilots are expected to play an exemplary, innovative and leading role in the overall SOE reform, so that all SOEs can learn from them, and the existing system and mechanism can be renovated, said Vice Chairman of SASAC Zhang Xiwu. He also stressed that the merging and reorganization of central SOEs will improve the structure and layout of state-owned assets, enhance the efficiency of resource allocation and avoid the homogenization of the enterprises.
In 2015, SASAC accomplished a series of mergers and reorganizations among central SOEs. Those affected included CSR Corp. Ltd. and CNR Corp. Ltd., China COSCO Shipping Corp. Ltd. and China Shipping Co. Besides that, China's three major telecommunication operators—China Mobile, China Unicom and China Telecom—jointly founded the China Tower Corp. Ltd., which is now the largest telecommunication infrastructure builder and comprehensive service supplier in the country.
"By pooling the tower resources of the three giants and sharing them together, these telecoms operators were saved from the necessity of building 265,000 telecom towers last year. Roughly 50 billion yuan ($7.63 billion) was conserved," said Tong Jilu, General Manager of China Tower.
Reform should revolve around advancing quality and efficiency, and efforts should be made to further integrate and reshuffle SOEs, said Peng Huagang, Deputy Secretary General of SASAC, calling for improving the structure and layout of state-owned capital and spurring transformation and upgrading.
Source: bjreview.com