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STATE OWNED ENTERPRISES (SOEs) - SUGGESTIONS FOR NXTGEN REFORMS

Popularity 2Viewed 2973 times 2017-2-25 01:27 |System category:News

State Owned Enterprises (SOEs) are very important part of nation's economy. In the present era of globalised economy , they face headwinds, which at times impacts their performance. Here are some suggestions for new age SOE reforms :

A. Mentoring System for Turnaround of loss making or sick SOEs
Selected bigger SOEs can be entrusted the responsibility of Mentoring loss making or sick SOEs so as to ensure that they are nursed back to becoming viable business entities. For this , schemes would have to be drawn to ensure clear cut accountability for Mentor SOEs coupled with a appropriate reward mechanism.

B. Land or asset pooling among SOEs
 Considering increasing cost of capital, SOEs can be encouraged to adopt practice of pooling of high value machinery and assets like land , office building etc

C. Evolution of Global Performance Benchmarks 
In order to make SOEs capable of meeting global standards, SOEs must evolve world class performance parameters in terms of operating efficiency, cost, throughput etc at par with their global competitors. SOEs, by virtue of the capital investment & space they occupy in the country's economy, must be international class. 

(Opinions of the writer in this blog don't represent those of China Daily.)


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Reply Report voice_cd 2017-2-27 08:51
thanks for sharing your story here, we would like to highlight it on the homepage.
Reply Report HailChina! 2017-3-1 16:20
This is a very important topic and I am happy to see a blog about it.

SOEs are an important part of nations economy and I think that with Donald Trump as US President there is a great opportunity to promote a more cooperative relationship between the US and China that promotes greater respect for each nations Core Values. Donald Trump has already spoken a lot about the US sides Core Values and this is a good thing for China because Donald Trump's view is that Americas Core Values do not need to be the Core Values of other nations. I think that Trump can accept and respect the fact that SOEs are important for many nations and that SOEs are a critical part of many national economies.

One thing that I think can encourage hard 'free market' capitalists to value SOEs is public-private partnerships. There are many great opportunities for US corporations to partner with Chinese SOEs for mutually beneficial win-win partnerships. China must improve the PPP scheme to make it more attractive to foreign investment.

Another thing is that the anti-SOE propaganda from hard western 'free market' capitalists is disproportionally directed at China and China must communicate to the US and the rest if the global community that this is unfair and unreasonable. Plenty of western nations still have State Owned Enterprises ( Canada Petro Canada for example ) but it is always China that gets attacked. China must do a better job of defending SOEs to the global public and do a better job of communicating the fact that SOEs are no barrier to open trade.
Reply Report sanjay_cro 2017-3-1 22:55
voice_cd: thanks for sharing your story here, we would like to highlight it on the homepage.
Please go ahead - you are welcome to do so.
Reply Report sanjay_cro 2017-3-2 00:14
HailChina!: This is a very important topic and I am happy to see a blog about it.

SOEs are an important part of nations economy and I think that with Donald Trum ...
Hi, Thank you for finding the contents relevant. You have brought out very important facets of the SOEs existing around the world over. PPP is a excellent concept & helps leverage the strengths of the SOE plus the participating partner in the business venture. Another successful model could be Joint Ventures between two or more SOEs.

Best Wishes
Reply Report HailChina! 2017-3-2 02:37
sanjay_cro: Hi, Thank you for finding the contents relevant. You have brought out very important facets of the SOEs existing around the world over. PPP is a excel ...
Thanks. Yes joint ventures is a great idea. Another idea is that it is in many ways just as good for private Chinese investment in PPP. It is just as good in many ways for Jack Ma or other Chinese citizens/groups to invest in PPP as it is to have foreign investment in PPP.

Thanks again for your blog.

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  • STATE OWNED ENTERPRISES (SOEs) - SUGGESTIONS FOR NXTGEN REFORMS 2017-3-2 02:37

    sanjay_cro: Hi, Thank you for finding the contents relevant. You have brought out very important facets of the SOEs existing around the world over. PPP is a excel ...
    Thanks. Yes joint ventures is a great idea. Another idea is that it is in many ways just as good for private Chinese investment in PPP. It is just as good in many ways for Jack Ma or other Chinese citizens/groups to invest in PPP as it is to have foreign investment in PPP.

    Thanks again for your blog.

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