Foreign investors able to buy large SOEs
By Wu Yong in Shenyang and Fu Jing in Beijing (China Daily)
Updated: 2005-09-16 05:57

International investors may take full control of almost all State-owned enterprises (SOEs) in Northeast China's Liaoning Province, according to an announcement yesterday by the province's Vice-Governor Li Wancai. The only exceptions to the new rules are SOEs under control of the central government and coal mines.

Li Wancai, vice-governor of Liaoning

In a meeting with a group of Internet media executives, Li said: "We encourage international investors to participate in the reform and restructuring of large State-owned enterprises.

"The ceiling percentage for foreign investment is 51 to 100 per cent. Foreign investors may take full control of all provincial SOEs except coal mine companies in Liaoning."

Li said Liaoning will push forward 200 items for international co-operation in such industries as manufacturing, petrochemicals and pharmaceuticals.

Liaoning is one of the last bastions of the planned economy in China where SOEs still dominate. International co-operation had been restricted to small and medium-sized SOEs and private companies.

Large SOEs have previously been a minefield for foreign investors. Although there has been co-operation, foreign investors have never been allowed a majority share.

Now, according to Li, international investors may take full control.

"This is a positive policy. I believe it will help the region attract more foreign investment," said Edgar Hotard, board chairman of Monitor Group in China, an international consultancy.

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