Skip to comments.China's leaders order Communist Party to take stronger role in business (China)
Posted on 01/25/2005 5:38:12 PM PST by maui_hawaii
SHANGHAI, China (AP) - In an apparent step backward from Western-style capitalist reforms, China has ordered a more active role for Communist Party officials in managing state-controlled companies.
Although Chinese corporations increasingly are modernizing management and seeking to meet international standards as they invest and issue shares overseas, party officials still call the shots in many strategically important industries.
A slew of financial scandals and corruption cases has prompted authorities to announce even tighter controls: A document issued last weekend spells out the role party members inside big corporations should play in company management, including serving as board members and choosing key executives, state media reports said.
"The party's never really gotten out of business,'' says Bob Broadfoot of the Political and Economic Risk Consultancy in Hong Kong.
He noted that one sign of the party's determination to keep a strong say in management came last year, when the government ordered top executives at three major telecom operators - China Mobile (Hong Kong) Ltd., China Unicom Ltd. and China Telecom Corp. to swap jobs.
"That was a party shake-up, not a simple industry shake-up,'' he says.
The latest guidelines call for all state companies to have party committees and ensure their "normal activities,'' the official Xinhua News Agency reported. It cited as key goals "increasing China's integrated national strength and consolidating the party's ruling status.''
In the past few years, the party has courted entrepreneurs, breaking from its traditionally negative attitude toward business to appoint scores of executives to legislative and government advisory positions.
But recently efforts have turned to cleaning up corruption and dodgy dealings at 181 major companies under state control, with officials complaining that many corporate managers have been caught misusing power, embezzling assets or taking bribes.
It is unclear how boosting the party's sway over decision making will help ensure cleaner corporate management, given the rampant levels of corruption within the party itself.
A continual campaign against abuse of power and other forms of corruption appears to have made little headway in the absence of reforms to strengthen the party's accountability.
The newly issued guidelines allow the top party official inside a company to serve as chairman of the board of directors, if qualified. But they note that in principle the two positions should be filled by different people.
Party committees are also ordered to help protect workers' rights and ensure "democratic management,'' the rules say, without giving details.
China had 150,000 state enterprises by the end of 2003. Most are controlled by local or provincial governments, with only the largest and most strategically important falling under central government control. - AP
a very clever ploy to cut down on the growth rate of the chinese economy! the more they get involved, the more screwed up the economy will become...
Oh boy, this could be a bad deal. Will the mother of all NEPs come to an end?
I just don't think it's right to characterize the changes introduced into China as "reforms". They are a means to the end of making China wealthy and powerful, not to re-forming it into any less of a totalitarian state. Anything that even has the vaguest shade of doing that will be quickly shutdown in my opinion.
This article tells me that the communists haven't learned anything since the 80's. History shall repeat itself once again.
"China may be ruled by the Communist Party, but is China's economy "communist"? Nope." - KwasiOwusu, Jan. 13, 2005
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