The reform of the supervision system over state assets featuring the management of capital is expected to transform State-owned enterprises into independent market participants and further improve the overall national economy, China’s top supervisor for state-owned assets said on Sept 17.
According to a State Council document issued on Sept 13, State-owned enterprises should be independently managed, separated from their ownership. State asset management institutes should draw clear supervision boundaries to avoid additional interventions.
The State Council also urged governments to optimize the layout of state capital, focusing on investments in crucial industries that are attached to national security, economic artery and people’s livelihood.
The country will map out related development plans, industrial policies and regulations regarding the profit allocation of state capital, to help guide the fine-tuning.
Moreover, a large quantity of outdated industrial capacity will be eliminated through marketized approaches, while State-owned enterprises will be encouraged to adopt international standards of operation and cooperate with counterparts through diversified ownerships.
To prevent the loss of state assets, the State Council called on State-owned enterprises to strengthen internal supervision, especially over power- and asset-intensive positions. Enterprises will also have to coordinate with other supervisory parties, such as auditing authorities and central inspection teams, to impose strict accountability.