SOE Reform: from Corporate System to Ownership System

WANG Zhongming ( 王忠明)
Director and Ph.D. in economics of the Center for Economic Research of SASAC

Editorial note:China's restructuring of state-owned enterpsies has been a major component of the country's reform and opening, and a driver of its impressive economic growth of the last two decades. An examination of this restructuring is important not only as a contribution to the general economic development literature, but also for China to best understand how its development has played out so far, and thus how it might best be continued.

During the lengthy process of state-owned enterprise (SOE) restructuring, the Communist Party of China (CPC) convened a number of landmark meetings of far-reaching significance. This article uses the third plenary sessions of the 14th and 16th CPC Central Committees as the frame of reference primarily because the former officially put forward the issue of setting up the modern enterprise system and the latter officially promulgated the issue of establishing a modern ownership system. It took China a decade to evolve from establishing a modern enterprise system to setting up a modern ownership system. For Chinese SOE restructuring, the evolution is no doubt a leap forward of enormous significance. There exists a strong correlation and chain of thought between the modern enterprise system and the modern ownership system.
In this respect, we can feel how reform architects have correctly appraised the situation and grasped the different stages in deepening reform to arrive where we are now.