China set to overhaul bloated, inefficient state-run firms: sources

Beijing

CHINA is preparing to overhaul its bloated and inefficient state-run companies to bolster an economy forecast to grow at the slowest pace in more than two decades, according to people familiar with the matter.

The proposal would include consolidation and reduction of the government's role in state-owned enterprises (SOEs) by stripping ownership stakes from the agency that regulates them, the people said. The plan, which could be released as soon as this month, calls for bundling the companies by industry and handing their control to state asset-management firms, the people said, asking not to be identified because the talks were private.

The shake-up is poised to affect thousands of companies, including some of the world's largest, such as China National Petroleum Corp and China Mobile Communications Corp. The country's state companies are perceived to be so rife with corruption and poorly run that Sanford C Bernstein & Co estimates that…