The administration has asked its local branches to support private companies to fund and operate projects in the sectors. The administration said it will continue to broaden access for private enterprises in other monopoly businesses where private funding is not prohibited by law. The further opening up came following an earlier decision by the state council, or the countrys cabinet, to encourage the development of both public and private economic sectors.
Meanwhile, China will stop subsidising bankrupt state-owned businesses within four years, an official with the state-owned Assets Supervision and Administration Commission said here on Saturday. The commissions four-year-plan has been approved by the state council, vice-minister in charge of the commission, Shao Ning said. In four years, state-owned enterprises will follow market rules and apply for bankruptcy according to the same laws and regulations as foreign and private companies.
In order to help the badly performing state-owned enterprises to retreat from the market smoothly, the Chinese government has made a series of favourable bankruptcy policies on employees rights, assets management and bad loans.
In recent years, 3,377 state-owned enterprises with bad performance have gone bankrupt under these policies with 6.2 million employees involved. There are still more than 1,800 state-owned enterprises to be closed down.
In February, the Chinese cabinet approved the bankruptcy plan. So far, Beijing and Shanghai municipalities and Jiangsu, Zhejiang and Fujian provinces have stopped the government bailout practice, a policy which was followed under the old Soviet-style planned economic system.