One of China's most prestigious universities is to end its direct ownership of its business enterprises and restrict its name to academic activities.

Tsinghua University, based in Beijing, is to set up a holding company to handle its stakes and rights in its companies before the end of the year.

 

Rong Yonglin, president of the Tsinghua Enterprise Group, said all the companies would remove "Tsinghua" from their titles and the university would no longer take unlimited responsibility for them.

 

The Tsinghua Stock Holding Co., Ltd. would be a state-owned limited company and act as a "firewall" to protect the university from operational risks, he said.

 

The companies should adopt modern corporate systems and make clear their property rights.

 

A local analyst, who declined to be named, said the move would incur losses for the former Tsinghua assets which were already listed as public companies or planned to do so. But in the long run, it would create a bigger stage for the businesses to seek higher profits.

 

Many Chinese universities own enterprises, which attract investors. Tsinghua's enterprises include Tsinghua Tongfang Computer Company and Tsinghua Ziguang Pharmaceutical Company.

 

(Xinhua News Agency October 8, 2003)