Beijing has released plans to convert all state-owned businesses into corporations before the end of 2017.
The centrally-run companies overshadow essential industries such as steel, aviation and power and China has vowed for many years that it would take action to renovate them.
Efforts to reform the enterprises have been opposed by vested interests. The enterprises are some of China’s biggest employers which have created dynamic circles for the officials who run them.
It has been said that State-owned enterprises (SOEs) that are managed by the federal government should strive to become limited corporations and companies by the end of December 2017. According to the State Council, China’s cabinet, 90% of Chinas state enterprises have already turned into corporations.
In June 2017, The International Monetary Fund (IMF), prompted Beijing to slowly get rid of state-owned firms that were under-performing and ‘zombie’ companies which are enterprises that only survive on rolling credit from banks.