SOEs see profit surge in Jan-Oct

Reforms boosting efficiency, vitality: official

China’s State-owned enterprises (SOEs) posted fast growth in revenue and profit in the first 10 months of this year, with industries such as nonferrous metal, steel and petroleum and petrochemicals reporting higher year-on-year growth rates.

From January to October, the revenue of SOEs increased 15.4 percent year-on-year to 42 trillion yuan ($6.33 trillion), and that of centrally administered SOEs reached 25 trillion yuan, up 13.7 percent year-on-year, said a statement posted on the website of the Ministry of Finance (MOF) on Tuesday.

Meanwhile, the profit of SOEs totaled 2.39 trillion yuan over the same period, an increase of 24.6 percent from the same period last year, and that of centrally administered SOEs came to 1.55 trillion yuan, up 17.8 percent year-on-year.

According to the MOF, companies in the nonferrous metal, steel and petroleum and petrochemical sectors saw large increases in profit while some industries such as electric power saw profit declines.

There has been an improvement in SOE efficiency thanks to positive changes, such as progress in SOE reform and changing of SOE systems, which have injected vitality into these corporations, Xiao Yaqing, head of the State-owned Assets Supervision and Administration Commission of the State Council, was quoted as saying in a report by People’s Daily on Friday. Xiao said the authorities will continue to boost SOE reform.

On Monday, a new-energy investment group was established via a merger of leading domestic coal miner Shenhua Group and utility giant China Guodian Corp, setting an example for the new round of centrally administered SOE reform, media reports said.

China has thousands of SOEs, but many have stagnated due to a lack of competition.

The government is trying to improve their performance through reform, moving toward mixed ownership and market-oriented management to improve efficiency, the Xinhua News Agency said.

According to a State Council action plan released in July, China’s major SOEs will complete corporate governance reform by the end of 2017, the Xinhu report said.

The reform targets SOEs supervised by the central government, excluding financial and cultural firms.