China's SOEs should be seen in factual light

Comments on Paul Hubbard "China’s global economic impact is no longer state-owned", 5/05/2016

Thank you Paul Hubbard for a fact based, balanced and well argued article in this particular field.

The point on China’s SOEs’ overseas investment reflected in the following statements are excellent:

“Foreign engagement with SOEs provides an opportunity for Chinese state business to experience and be subject to the discipline of competitive markets, without special privileges, in well-regulated economies.

“Foreign investment into China helped align China’s nascent private sector with the rules of the global trading system. Likewise, Chinese state investment overseas can be a channel to take back to China international standards for transparency, corporate governance and market behaviour.”

I highly appreciate and commend this article.

PS: More importantly, the point on the fact that SOEs exist in virtually all countries including advanced western economies. The differences are a matter of degree not a matter of having or not.

Understandably, there have been a privatisation process in many countries, particularly in advanced western economies. In Australia, for example, a number of big former SOEs have been privatised, such as the Commonwealth Bank of Australia, Qantas, Telstra (formerly Telcom).

Notwithstanding the privatisation process, there are still SOEs in western economies.

In Australia, for example, you still have SOEs including Australia Post, Medibank Private and Defence Housing at the national level, some electricity and water enterprises owned by the State and Territory government at the state level. The Snowy Mountain hydro electricity is jointly owned by the federal and some state governments. Some ports, rails and buses in Australia are government owned entities.