A senior official said here Wednesday China now has some 2,500 large and medium-sized state-owned enterprises (SOEs) that are in fact bankrupt but yet to be closed down.

Li Rongrong, minister in charge of the State-owned Assets Supervision and Administration Commission, made the remarks at the International Merger and Acquisition Summit Beijing 2003.

These SOEs employ 5.1 million workers and involve a total of 240 billion yuan (US$29.0 billion) of liabilities.

Li said the SOEs cannot immediately exit the market due to certain restrictions, including banks' inability to write off the non-performing loans, limited fiscal resources of the government and inadequacy of the social security system.

From 1994 to 2002, Li said, 3,080 SOEs were closed down or went bankrupt in China, with 199.54 billion yuan (US$24.1 billion) of non-performing loans written off and 5.3 million laid-off workers relocated.

(Xinhua News Agency November 20, 2003)