BEIJING, China (27 January 2000)--China is on its way to turning around its state enterprises, according to a report by the Associated Press. Currently in the second year of a three-year reform program, the government should succeed in getting most key state enterprises out of chronic debt and ready for the free market by early 2001.
Last year government measures led to a 70% rise in total state enterprise profits to US$10.9 billion.
"The year 2000 will be the year of decisive battle in our reform of state enterprises,'' said Sheng Huaren, minister of the State Economic and Trade Commission. He added that more enterprises would be merged or allowed to fail.
According to the AP report, bringing free markets to the sprawling, inefficient state sector is the last major unfinished task in China's 20-year reform drive. Although state firms now account for less than half the goods and services in China, they dominate strategic sectors and employ the bulk of the urban work force.
The reform means the loss of many jobs. Last year 11 million state workers were laid off, of which 6.1 million were unable to find new jobs. Currently China has an estimated 11.8 million unemployed urban workers, or 6.5% of urban China. (JW)