SOEs to focus on stable growth in 2013

The top priority for China's centrally administered State-owned enterprises (SOEs) in 2013 is stabilizing growth, the head of the State-owned Assets Supervision and Administration Commission (SASAC) said Monday.

There are five major tasks next year, including deepening reforms, pursuing industrial upgrading and strengthening management, but stabilizing growth is the top priority, Wang Yong, chairman of SASAC, said at a meeting held in Beijing.

Central SOEs - which refers to the 117 SOEs governed by SASAC - made a total profit of 1.1 trillion yuan ($176.3 billion) in the first 11 months of 2012, nearly unchanged from the same period last year. They also raked in 20.1 trillion yuan in sales revenue from January to November this year, marking year-on-year growth of 8.9 percent, according to data from SASAC.

Wang noted that the sales figure represents significant progress, given the country's economic slowdown this year.

Central SOEs experienced profit drops in the first two quarters of 2012, caused by an overall decline in global economic growth, but managed to reverse the decline in the third quarter thanks to a series of measures taken to shore up profitability, he said.

"Central SOEs' better business performance is based on policy advantages. Profitable SOEs are mainly in monopolized sectors such as resources and finance," Li Shuguang, a professor specializing in SOE reforms with China University of Political Science and Law in Beijing, told the Global Times Monday.

"So rather than stabilizing growth, SOEs' top priority should be increasing their competitiveness," Li said.

"The quality of central SOEs' profit growth this year is not as good as in previous years, as for many central SOEs, the amount of accounts receivable has increased," Zhu Boshan, general manager of Shanghai Tacter Investment Consulting, told the Global Times Monday.

For next year, Zhu said central SOEs in the monopolized sectors will still face pressure, because domestic demand for resources such as power and coal will not pick up quickly, while those in more competitive areas do not perform as well as their private or foreign counterparts due to a lack of innovation.

Wang admitted that these are problems for central SOEs. "Many central SOEs are still in the low- and mid-end of the industry chain, and have not become involved in the strategic emerging industries," he said.

"Executives of central SOEs can rotate their positions as government officials, and officials can also take positions in central SOEs. Further reform should tackle this problem and make top executives of central SOEs more professional," Zhu said.