From Chinese Press

SOEs have social responsibilities

(China Daily)
Updated: 2010-09-21 08:18

At the latest Summer Davos Forum in Tianjin, Li Rongrong, former director of the State-owned Assets Supervision and Administration Commission, lauded the performance of State-owned enterprises (SOEs). Though he conceded that most of the SOEs are monopolies, he said they have made great contributions to the country's economic development. Their great achievements, however, should not be an excuse for them to shun their social responsibilities, says an article on Xinhuanet. Excerpts:

Some SOEs, especially those in oil, telecommunications, and electricity generation and supply, have expanded their businesses rapidly, increased their profits and risen on or entered the list of Fortune Global 500 companies in terms of revenue.

But it should not be forgotten that their remarkable achievements are the result of the huge subsidy that the government grants them and the heavy price their customers and users of their services are made to pay. Besides, private enterprises, which also contribute a great deal to country's employment and innovative capacity, do not enjoy the preferential policies granted to the SOES.

The development of some industries such as oil and telecommunications is tied to the country's energy strategy and national security, and monopolies in these fields may be inevitable for the time being, but the prevailing conditions should undergo gradual change to create a fairer mechanism for competition.

The SOEs should use their advantage to become more production efficient and innovative. More importantly, apart from pursuing profit they should also accord priority to the general interest of the public.

As enterprises backed by the State and the people, they have to shoulder more responsibilities, instead of just donating for rescue and relief operations after a serious disaster strikes some part of the country.