China has lately been facing harsh criticism for its economic management, with many outsiders taking aim at the authorities’ postponement of the much-touted reform of state-owned enterprises. But there is a good reason for delay.
HONG KONG – China has lately been facing harsh criticism for the direction of its reforms of state-owned enterprises, particularly its strengthening of the role of Communist Party committees in SOE management. But while this might seem like a step backward for China’s market-oriented reforms, there are good reasons to boost oversight, at least for now. With China undergoing a fundamental transformation into an innovation-driven, knowledge-based, and services-led economy, its leaders must think carefully about how to reform the SOEs so that they can contribute to the new economy.
HONG KONG – China has lately been facing harsh criticism for the direction of its reforms of state-owned enterprises, particularly its strengthening of the role of Communist Party committees in SOE management. But while this might seem like a step backward for China’s market-oriented reforms, there are good reasons to boost oversight, at least for now. With China undergoing a fundamental transformation into an innovation-driven, knowledge-based, and services-led economy, its leaders must think carefully about how to reform the SOEs so that they can contribute to the new economy.