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SOEs profit surge fuels call for fair distribution

(Xinhua)
Updated: 2009-05-06 17:26

An 85.7 percent month-on-month surge in the profits of central State-owned enterprises (SOEs) in March has triggered call for a fair distribution of their profits.

Related readings:  Profits of China's central SOEs decline in Q1, but more slowly  Profit for all from SOEs  Vice President urges 'scientific development' of SOEs  Pay cap set for CEOs of state-owned firms

The 138 SOEs made a profit of 62.29 billion yuan (about $9.1 billion) in March.

"In France, SOEs turn in 50 percent of their profits as dividends to the government. SOEs in Sweden, Denmark and the Republic of Korea turn in about one third to two thirds of their profits," Zhu Lijia, a professor with the National School of Administration, told Xinhua Wednesday. The school specializes in training cadres.

"SOEs only turn in at most ten percent of their profits as dividends to the government. The percentage is too low," Tang Min, deputy secretary of China Development Research Foundation, which is affiliated with the Development Research Center of the State Council.

"The international average is about 30 percent," he said.

Centrally controlled SOEs were required as of 2007 to pay 5 percent to 10 percent of earnings as dividends, depending on their industries, under a regulation issued by the State Council.

Analysts also said that central SOEs have benefited most from the 4 trillion yuan stimulus plan announced last year, compared with the private sector.