Challenges in the Era of Globalization - iaabd

Proceedings of the 12th Annual Conference © 2011 IAABD
L Communication and Cultural 1 0.66% 2 0.32% 1 0.48%
M Miscellaneous 1 0.66% 40 6.46% 21 10.05%
Total 152 100.00% 619 100.00% 209 100.00%
Table 1 shows that Chinese central business has the following properties and trends.
First, the central business capital is concentrated in key industries which relates to the national security
and national economy safety, such as the extractive industries.
The central SOEs are also focused in some particular chain mechanism where market mechanism is
difficult to play a role or some basic industries which require significant control from government. Those
industries include basic services, infrastructure, basic raw materials, key technologies, the key processes,
etc. The typical cases are electricity, gas and water. Third, capital of central SOEs concentrated in
industry where central SOEs have competitive advantage such as industries requiring high capital
investment or high barriers to entry (e.g. strict polices at market access). In particular, the industries could
be oil, chemical, plastic, plastic, electronic metal, nonmetal, machinery, equipment, instruments, etc.
Finally, the central business also attaches importance to the possible future leading industry. They are
gradually investing and developing the industries with broad market prospect, such as high-tech
industries. As shown in the Table 1, the proportion of the central state-owned listed companies in the
information technology industry is same as the private economy. Such industries are competitive, require
big investment and updated quickly. The relatively high proportion in this economic sector shows state’s
intention to let SOEs play leading role in high-tech industry.
Enterprise size and performance comparison
In order to reflect the central SOEs’ value, operating performance and the other features, we listed the
main financial data of listed companies owned by central SOEs and then compared them with other type
of companies in the same period as shown in Table 2.
Table 2 Operating Performance of Listed Companies
Central SOEs Local SOEs Private companies
Financial Indicators
average Median Average Median average Median
Asset-liability ratio 51.18% 52.17% 49.45% 49.92% 49.89% 51.43%
Rate on equity(ROE) 10.10% 9.74% 7.56% 7.94% 7.36% 8.17%
Total Assets (billion) 14.91 2.70 2.73 1.74 5.59 2.76
Total Liabilities(billion) 8.40 1.54 1.48 0.82 2.92 1.31
Total equity (billion) 6.51 1.33 1.24 0.85 2.66 1.30
Total equity (billion) 15.97 2.06 1.75 1.00 4.20 1.58
Operating income
(billion) 1.26 0.11 0.18 0.09 0.37 0.12
Net profit (billion) 0.99 0.10 0.14 0.08 0.30 0.10
758