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      Scholar defends China's reform of monopoly industries

      2012-09-19 17:26 Xinhua     Web Editor: Gu Liping comment

      A scholar with an influential Communist Party magazine has ruled out the possibility of quick privatization of China's monopoly industries, and warned against mimicking Western models.

      In a signed article published recently on Qiushi, or "Seeking Truth," Wu Qiang, assistant to the editor-in-chief of Red Flag Manuscript, said that privatization does not provide an answer to all questions brought about by monopoly.

      "It is an advantage of China's socialist system that the state-owned economy plays a leading role in the national economy," he wrote in the biweekly official journal of the Communist Party of China Central Committee.

      In defense of China's reform of its monopoly industries, Wu said the country's endeavor to reform monopoly industries has been "incessant" since the 1980s, which had empowered its telecommunications, power, civil aviation and oil industries to compete globally.

      "To reform is to promote the beneficial and abolish the harmful. Reform of the monopoly industries is not about giving up the strengths that we already have," he wrote.

      With stronger management, talent pool, technology and innovation capability, Wu believed China's state-owned enterprises (SOEs) have played a prominent role in promoting overall economic development with different types of ownership, and have raised their global competitiveness.

      Wu's article comes at a time when many of the Chinese public have called for the government to loosen its grip and invite the private sector to join the competition in monopoly industries.

      China's SOEs are accused of wielding their influence to pursue profits in market competition. They are also accused of extravagant spending and becoming a hotbed for corruption.

      Wu admitted it is necessary to step up the reform of China's monopoly industries by establishing competition mechanism, promoting fair play and enhancing government regulation and public supervision.

      However, China cannot copy from A to Z Western models of privatization, which were adopted by some developing countries in the 1980s and 1990s and resulted in widening wealth gap and reduced economic vitality, Wu wrote.

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