The State Sector: China’s strategy to strengthen and consolidate state-owned enterprises

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Art 7 of the CPC Assessment Methods – The State Sector

When a case is argued in court the person who institutes the suit is known as the plaintiff and the person against whom the case is brought is called the defendant. This is the last major component of the CPC assessment methods and carries 1/3rd marks.

Ideally the chairperson nominated for each CPC session should be from another department to ensure his effectiveness as moderator, time management specially in case of multiple speakers and facilitate a good amount of floor interaction. However this is not practical.

The State Sector

The Chinese state sector is envisioned as being the primary driver of growth across industries considered essential to China’s future economic development. Thus, the central government is implementing reforms to make SOEs “stronger, better and bigger”.

One way it is doing so is through a series of billion dollar “megamergers” between large state-owned enterprises. These mergers consolidate state control in strategic sectors of the economy and help reduce intra-state competition. However, they also raise debt levels among Chinese SOEs and weaken their competitiveness against U.S. and other global firms.

Additionally, the Chinese government has been stepping up its monitoring of management teams in high-priority state-owned industrial enterprises. Special inspectors are tasked with interviewing departmental managers and staff and inspecting their work records. This is to help ensure that the management team has a clear understanding of the enterprise’s business situation and performance. These efforts are expected to lead to the discovery of solutions for improving loss-making state-owned enterprises’ performance.

The People’s Liberation Army

The People’s Liberation Army (PLA) is China’s armed forces, and its soldiers swear their allegiance to the party. Since its inception in 1927, the PLA has never been viewed as a national military; it is a political army that operates under the doctrine that “the party commands the gun.” China’s top military authority is the Central Military Commission (CMC), which is customarily chaired by the CCP’s general secretary.

It is also important to note that the rank and file soldiers have little clout in terms of social mobility or economic benefits. Pensions are meager, and soldiers often live in poverty in their old age. Although the PLA has made significant advances in technology and combat readiness, it still has a long way to go before it is considered a world-class military. In 2023, the PLA is scheduled to reach three milestones in modernization: mechanization by 2027, intelligentization by 2035 and full transformation into a world-class force by 2049.

The People’s Republic of China

A one-party state led by the Communist Party of China, the People’s Republic of China is now one of the world’s most powerful economies and possesses the second largest military in the planet. Its armed forces, the People’s Liberation Army, is one of the most formidable in the world and includes an extensive fleet of nuclear-capable missiles.

In 1949, Chairman Mao established the Communist Party’s control over all areas of the nation and instituted the nine-year compulsory education system. While he still championed class struggle and the independence of the CCP, these were given secondary importance to national unity and the revolutionary struggle against Japan.

Mao condemned religion as “the opiate of the masses” and created a Religious Affairs Bureau to regulate and oversee religious activities. The bureau encouraged patriotic religious associations to manage and monitor activities of Buddhism, Islam, Protestantism, Catholicism and Taoism. It also promoted the “three self” movement — that is, self-government, self-support and self-propagation — for religious groups.

The National People’s Congress

As China’s unicameral legislature, the NPC exercises supreme legislative authority. It also governs the central government, the Supreme People’s Court and the Supreme People’s Procuratorate. The NPC and the CPPCC are China’s major deliberative bodies and, once a year, they convene for what is known as the Two Sessions.

This year’s sessions reflected Xi’s dominance in state institutions. In particular, the leadership posts of all state institutions – including the Presidency, the National People’s Congress Standing Committee, the Supreme People’s Court and the Central Military Commission – were filled with people Xi trusts, effectively integrating state office into his leading group.

In addition, the NPC adopted a number of changes to the way in which it legislates and oversees the work of the government. This includes giving the NPC’s Standing Committee the power to pass legislation with a single review session, rather than the previous requirement of three. The NPC also made it easier for the NPC to sanction alleged corrupt officials and banned foreigners from owning property in Chinese territory.

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