Beijing has to reform its loss-making state-owned firms, say analysts

The Chinese economy's state-owned giants - dubbed "the elder sons of the republic" for always getting the best share of everything - have gone from strength to strength in the past decade.

Seventy-three mainland companies - 68 of them state-owned - made it onto magazine's Global 500 list of the world's biggest corporations last year, up from just 11 in 2003 and outnumbering Japanese companies for the first time.

State-owned China Petrochemical (Sinopec), China National Petroleum Oil Corporation (CNPC) and State Grid are now ranked among the top 10.

It's a success story that seemed impossible just 15 years ago - when thousands of the mainland's state-owned enterprises, known as SOEs, were on the brink of bankruptcy.

Overseas media reports then were dominated by talk of how the "economic dinosaurs" could collapse overnight, putting millions of people out of work, sparking widespread social unrest.

The transformation since then has been remarkable, but some critics have pointed out that the SOEs' revival was largely based on preferential policies, massive subsidies and market monopolies.

They benefit from lower borrowing costs, easy access to land and other resources, and the power to set prices.