"17. China’s Enduring Pursuit Of State-Owned Enterprise Reform" - By CWP Alum Wendy Leutert
State presence in China’s economy remains strong, despite decades of marketoriented reforms since the late 1970s. State-owned enterprises (SOEs) account for approximately a quarter of GDP and have done so for nearly 25 years (Batson 2020). SOEs are leading players in Chinese industry, equity markets and overseas direct investment. Today, there are 97 central SOEs under the administration of China’s national-level government ownership agency, the State-Owned Assets Supervision and Administration Commission (SASAC) (Guoyou 2021). Subnational governments also own and operate large portfolios of local SOEs at home and abroad. China now ranks first worldwide with both the largest total number of SOEs and the highest share of SOEs among its biggest companies (OECD 2017). Chinese SOEs endure because they serve crucial functions for the state. They contribute to central and local government revenues through dividends and taxes, support urban employment, keep key input prices low, channel capital towards targeted industries and technologies, promote sub-national redistribution to poorer interior and western provinces, and aid the state’s response to natural disasters, financial crises and social instability (Batson 2017). For Xi Jinping, as for earlier Chinese leaders, SOEs “constitute an important pillar of the national economy and play a role as pillars of the economic foundation of the CCP’s rule and China’s socialist state power” (see Barry Naughton’s article in this volume) (Xinhua 2014).
https://epress.nus.edu.sg/cpcfutures/9789811852060-17.pdf - https://epress.nus.edu.sg/cpcfutures/
Leutert is the GLP-Ming Z. Mei Chair of Chinese Economics and Trade. Her research focuses on Chinese political economy, specifically the historical evolution and global expansion of China's state-owned enterprises. Other areas of her research include leadership in China's public sector, China’s early reform and opening, corporate governance in state-owned enterprises, and international investment and trade. Her research is forthcoming or has been published in The China Quarterly, China Perspectives, and Asia Policy. Her commentary has been featured in media outlets including the Financial Times, New York Times, Reuters, Washington Post, and South China Morning Post.
Photo Credit: By Shubert Ciencia - originally posted to Flickr as Power Plant (Tianjin, China), CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=12263059
