The Chinese government plans to widen the sectors covered by its mixed-ownership reform of state-owned enterprises, or SOEs, to help raise their profitability further and reduce their reliance on public coffers, state-run Chinese newspaper China Daily reported March 21.
China will implement the third round of its SOE ownership reform in 2018, encouraging more foreign investors to snap up shares in 31 SOEs across more sectors such as public services, said Peng Huagang, deputy secretary-general of the State-Owned Assets Supervision and Administration Commission, or SASAC.
Peng said among the 31 SOEs participating in the round, 10 are centrally administered and 21 are at the local level, but did not name them. There are 98 centrally administered SOEs currently, down from 117 five years ago, China Daily said. Last year, economists signaled the possibility of deeper reform of SOEs with debts running at about 115% of GDP.
"We will work consistently to make SOEs into leaner, better performers, increase the core competitiveness of their main businesses, and strengthen, expand and increase returns on state capital," Peng added.
Diversifying the ownership structure of SOEs is a key part of the reform plan, China Daily quoted SASAC Chairman Xiao Yaqing as saying at a media briefing on the sidelines of the 13th National People's Congress, the top legislative body, on March 10.
"We would be delighted to see foreign companies taking part in the mixed-ownership reform. China remains committed to opening up," said Xiao, adding that the government will review and potentially expand the pilot programs related to granting equity stakes to employees in mixed-owned SOEs, while considering setting up long-term incentives and restraining procedures.
In 2018, the Chinese government will also put in place measures so that only the strongest SOEs survive and will "move quickly" to deal with inefficient state-owned assets, China Daily reported.
In 2017, SOEs' total sales revenue rose an annual 14.7% to 50 trillion yuan, while profits climbed 23.5% to 2.9 trillion yuan, China Daily said.
As of March 20, US$1 was equivalent to 6.33 Chinese yuan.