China’s newly established leadership in the field of state-owned enterprises has been the highlight of the domain of the international economy. Michael Wines published a report in the New York Times commenting on this leadership, its start, its results and its effects on the operations of the private sector.
China’s interest in the private sector business seemed to fade as a direct consequence of the global recession, when prices kept on increasing and decreasing without warning for more than 2 successive years. As a result, the economy could not maintain a stable ground to protect the consumers.
129 of the state-owned Companies took control over chief industries in the economy of China, such as mining, power generation and transportation. Some of these Companies tried to compete on a higher level in the auto market, yet not all of them succeeded. As a result, the Government gave orders that these ‘weak’ Companies would be merged with other Companies, which proved adequate in the competition. Consequently, the Chinese auto manufacture business maintained its solid position in the market.
The Prime Minister of China, Wen Jiabao, has previously promoted for that move in his address last March. He said, “The socialist system’s advantages enabled us to make decisions efficiently, organize effectively and concentrate resources to accomplish large undertaking”.