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Pushing SOE Reform

By Huang Weiwei

The reform of state-owned enterprises (SOEs) has been a policy strategy for a long time. But most of them have so far failed in the competitive market. Many large-scale SOEs face bankruptcy. The biggest problem is corruption, and this is an evil the whole country is having to face.

The rapid economic development has provided the construction industry with a rare opportunity to thrive. But most projects managed by SOEs have lost money. On the contrary, the subcontractors affiliated with them are raking it in. Everyone knows its secret.

Maybe taking bribes should be strictly punished by law. But the most serious problem, in my view, is that the money spent by top SOE leaders is not properly supervised. The local government should be responsible for failing to perform its duty. Immoderate spending has led to financial crises in companies. Under the excuses of recruiting business and expanding their market share, they have spent more unnecessary money to entertain themselves.

Trade unions, organizations that should protect workers' rights, have joined company management and thus failed to perform their duty. Trade union chairmen these days merely worry about how to stay in power. He or she should strike a balance between workers and leaders. Most of time the leaders get priority.

We should learn the management expertise in multinational corporations. After China joined the World Trade Organization, more and more foreign companies have joined the competition. The situation is not optimistic. How SOEs can survive is a really important issue. After all, they are the backbone of China's economy.

(China Daily November 4, 2004)

SOE Reform Heads in Right Direction
Shanghai Vows to Boost SOE Reform
Achievements Made in Industrial Restructuring, SOE Reforms & Rectifying and Regulating Market Economic Order
Chinese SOEs Reborn After Reform
Goals of SOE Reform Achieved
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