The State-owned Assets Supervision and Administration Commission (SASAC) of the State Council has called for the engagement of non State-owned capital, including private and foreign assets, in the stake-holdings of listed central government-invested State-owned enterprises (SOEs).

"To promote their comprehensive strength in a global market full of opportunities and challenges, SOEs are supposed to welcome both private and foreign enterprises to be dynamically involved in their management and share holdings," said Wang Yong, chairman of the SASAC.

According to the 21st Century Business Herald, the Government of Singapore Investment Corporation (GIC) expressed an interest in investing in China's SOEs last year.

Wang said the current complicated and volatile economic environment, both at home and abroad, has posed more challenges to China's SOEs, most of which are expected to grow into global industrial giants and become China's economic locomotives.

"Equity diversification is crucial for SOEs to form a modern corporate management structure, with which these backbones of the Chinese economy can compete with other multinational companies in the global economic arena," Wang added.

In December, SASAC announced support for up to 50 SOEs in their efforts to become leading global companies with strong international competitiveness and influence, over the next five years.

As a part of the effort to reinforce the strength of SOEs, SASAC has vowed to accelerate their integration, in a bid to optimize the allocation of State-owned assets.

According to SASAC, 60 percent of SOEs are now listed companies to some degree, as they are partially or completely listed on the markets.

Ji Xiaonan, head of the supervisory committee at SASAC, was quoted by local media as saying that more than 40 of the 120 central SOEs will accomplish a complete listing this year.

China Reform Holdings Corporation Ltd, a State-owned capital-operating company backed by SASAC, was founded in December, as an engine for SOE integration.

The new company will acquire and restructure SOEs that are small-scale, have a low market share, and are not involved in crucial industries.

"We define China Reform Holdings as a market-based platform to operate and manage State-owned assets in accordance with SASAC's upgraded allocations for SOEs," Wang said.

SASAC plans to reduce the number of central SOEs from 120 to between 80 and 100 during the next few years to ensure the rational deployment of State-owned assets.

In the first 11 months of 2010, the total profit generated by SOEs reached 802 billion yuan ($121 billion), a year-on-year increase of 50.1 percent.

Wang said that their diversified stake-holding structure allows SOEs to share their high profits and fast growth with more non-governmental enterprises and retail investors.