As a country with a transitional economy, the management of its assets has always been a topic of great sensitivity. In the past 20 years many methods have been used since it first adopted a policy of openness and reform.

This year, the 10th NPC has received a draft plan to overhaul and strengthen the management of the state’s assets. State Councilor, Wang Zhongyu, unveiled a draft plan on March 6 to restructure government institutions which included the establishment of the State Assets Management Commission.

Yang Xiaotang, general manager of China Electronics Corporation (CEC) and former vice governor of China Development Bank delivered his viewpoint about state asset management in the group discussion.

It is understood that China’s assets are worth over 10 trillion yuan. “But, actually China doesn't know how much its assets are worth or the appreciation or losses of its state assets to date,” Yang said.

Now that many provinces have begun to sell their state assets, there is considerable concern over their state worth. In Xi’an for example, 49, 942 billion yuan worth of state assets have been reported sold in the last two years with 60 businesses in the first submitted list. Shenzhen city government has planned to offer 30-50 state holding companies for sale. Chongqing Municipality has said that it will sell its state assets worth 100 billion yuan, for cash, within three to five years.

Yang is concerned that the rush to sell off the assets of the state might well cause greater losses. He said, “State assets tend to move from the competitive industry, leaving room for the development of private enterprise and foreign investment but there is no regulation on the sale price of these assets.”

“The operating system of state owned enterprises (SOEs) is out of date. One of the important reasons is that there is no specific manager to supervise it,” Yang said. “For the sale of SOEs with profitability, there have been many supervisors such as the Ministry of Finance, Ministry of Labor and Social Security, State Economic and Trade Commission, but for those less profitable ones there is no department to take care of them.”

He has praised the move to establish the commission in order to protect and supervise the states assets, which in turn will lead to great efficiency of their management.

The commission will unify responsibility for finance, personnel and decision-making. Wang’s report proposes that central and local government administer their state assets separately.

However, deputies, including Yang, said this should be revised in order to better protect the assets of the state as a whole.

It was understood that the 9th NPC had placed the protection and management of the state’s assets on a proposed list for legislation at the next congress. Now it is due to become law.

(China.org.cn by Staff Reporter Tang Fuchun, March 12, 2003)