Foreign firms keen to cooperate
China's State-owned enterprises (SOEs) have "improved a lot in their core competitiveness," including in their innovation and research ability, which is crucial to a firm's sustainable development, Xiao Yaqing, head of the State-owned Assets Supervision and Administration Commission, said at a session of the Boao Forum for Asia, in South China's Hainan Province, on Wednesday.[Special coverage]
"SOEs that were set up to fulfill Chinese demands in infrastructure such as telecommunication and transportation are now opening up to the world and cooperating more with foreign firms," Xiao said, stressing that SOEs are now also open to the same level of market competition as their private peers.
Xiao's opinion was echoed by Zhu Min, former deputy managing director of the IMF, who participated in the same session. Zhu noted that China's SOEs, whose assets value stands at around 50 trillion yuan (.95 trillion) now, are not only growing bigger but also stronger.
"Based on my experience, foreign companies are showing strong interest in partnering with SOEs - they are impressed by SOEs' technology and the sheer size of their industrial chain," Zhu said, noting that there is room for SOEs to further expand.
"SOEs' future competitiveness is unlimited, because they can branch out into new businesses based on their position as the backbone of the national economy… For example, we know there is a trend toward the Internet of Things (IoT). Can you image how much the growing number of IoT users will contribute to State-owned telecom firms' future revenue?"
Xiao that reforms to SOEs are also making headway. He noted that currently, about 60 percent of China's SOEs have been listed in the capital market.