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For example, private firms generated sales of 797.3 billion yuan (US$101 billion) last year an annual growth of 55 per cent since 2000 in smelting and processing of ferrous and non-ferrous metals alone. They have also invested in sectors such as post and communications, power and coal gas, according to the report.
In tandem, the growth rate of taxes paid by the private sector has by far surpassed that of State companies and the sector has become a major contributor to State coffers.
Over the past five years, taxes paid by private firms grew by at least 40 per cent a year, compared with an annual increase of less than 7 per cent by State businesses.
"In many a local region in China, tax revenue generated by the private sector accounts for over 80 per cent of local government revenue," the report says.
Despite their stellar performance, said Gu Shengzu, vice-chairman of the All-China Federation of Industry and Commerce, private companies still face barriers in securing financing, which was hobbling their development.
Less than 10 per cent of total bank lending goes to domestic private firms while overseas-invested businesses enjoy preferential treatment in taxation and financing, he pointed out.
Chen Yongjie, one of the main authors of the report, said private companies must be given a level playing field promised to them in terms of market access, financing and tax policies.
Chen said he believed that a group of conglomerates competitive in both local and global markets would emerge in the private sector by 2010.
"Some of them will join the ranks of the Global 500," he forecast.