The bottom line is that the equitisation process, no matter how it is going, will not cause any losses to State property, and that after selling shares at market prices, enterprises will be able to boost their operations.

On the contrary, massive equitisation will only bring pressure to bear upon SOEs which have no option but to sell shares at lower prices without considering the consequences. Many people even make use of equitisation to sell shares at lower prices and turn a profit for themselves and their relatives rather than for the company.

Our goal is to tighten and enhance the capacity of State management over SOEs. However, most SOEs are currently carrying out equitisation in an opposite direction. Equitisation must be based on the enterprises’ development strategies to help them identify areas for which they need to mobilise capital. In fact, SOEs pay more attention to selling their property than mobilising capital during the equitisation process. In addition, stake buyers also pay more attention to the company’s property than its profit-making capacity, feasibility of business strategies, and transparency in business management.

There are two things that SOEs need to do during the equitisation process. First, they will be transformed into limited companies to operate under the Enterprise Law. Second, their enterprise property ownership will be changed into a new form to make State ownership more effective. 

In fact, we have no specific agency responsible for State ownership rights and still lack mechanisms and criteria to assess the working efficiency of this agency.