Subject
SOE reform in China.
Significance
Recent announcements by senior figures give indications of state-sector reforms planned for 2016 and beyond. These break new ground in the range of industries affected, the degree of reform and the extent to which state-dominated markets are opened to private and foreign capital. In 2004, there were 196 central state-owned enterprises (SOEs); now there are only 111; the target is to reduce this to around 50.
Impacts
The focus of reform in 2016 will be heavy industry, where 70% of SOEs are concentrated.
Integration of central SOEs in infrastructure and energy will create more formidable competitors to established multinationals.
Some SOE-monopolised markets will open to private and foreign investment, including telecommunications and finance.
SOE reform will expose corruption; anti-corruption operations will accompany it.
