China reforms SOE salary-setting mechanism
China’s cabinet has demanded a reform of the salary-setting mechanism for state- owned enterprises (SOES) to increase their efficiency.
Authorities should establish a salarysetting and growth mechanism that is suited to the labor market and is linked to the SOE’S economic performance and labor productivity, according to guidelines issued by the State Council.
The guidelines state t hat t he work should focus on “increasing the vitality and efficiency of SOES”.
The total amount of salaries for SOES should be better determined according to their performance, and management of the companies’ inner salary distribution should be improved.
The guidel ines also expressed that “oversight of the SOE salary distribution should be strengthened, state capital should be supported in becoming stronger, doing better and growing bigger, and income distribution should be more reasonable and orderly”.
China has pushed for SOE reforms, including mixed-ownership reform and corporate reform, to inject vitality into a large number of previously underperforming enterprises.
provinces and in Tianjin will focus on high quality development, supply- side structural reform, institutional innovation and risk prevention, according to a document recently released by the State Council.
Ren Hongbin, Assistant Commerce Minister, explained that the zones will be given greater decision-making powers to chart new paths for opening- up, improve government management and foster new growth drivers and a competitive edge.
“The move shows that China will continue its steps to open the local market, especially in the fields of foreign investment management, trade facilitation, financial innovation and the transformation of government functions,” said Xu Hongcai, an economist at the China Center for International Economic Exchanges.
The deepening reform and opening- up of the free-trade zones is one of the concrete steps that China is taking to improve the business environment and facilitate global trade, said Wei Jianguo, a former ViceMinister of Commerce.
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