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Two Sessions 2021
EconomyChina Economy

China’s ‘two sessions’: Beijing promises level playing field but boosts support for state firms

  • The government’s new work report promises equal treatment for private and state-owned enterprises (SOE)
  • But Beijing’s push for SOE innovation to reach tech self-sufficiency could undermine the goal, some analysts say

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China wants to enhance its state firms’ competitiveness, innovation, power and risk-management capabilities. Photo: AFP
Frank Tang

China has highlighted the fair treatment of all market entities in its new five-year economic plan, as it tries to reconcile development of both private and state firms and fend off criticism from foreign governments.

However, Beijing’s emphasis of “better, bigger and stronger” as the guiding principle for state-owned enterprise (SOE) reform is likely to stir suspicion overseas and at home that government-backed firms could be given an even greater role in future economic development.

“While resolutely consolidating public ownership, we’ll also resolutely encourage, support and guide the development of non-public sectors,” Premier Li Keqiang said last Friday while reading the government’s work report to nearly 3,000 lawmakers at the annual “two sessions” meetings.

“All the market entities are contributors to our modernisation. They must be treated equally.”

Reform of China’s state firms – many of which are among the Fortune 500 list of largest companies in the world – has long been a feature of the premier’s annual work reports.

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