Business / Industries

Private firms need a boost to compete better

(China Daily) Updated: 2012-12-02 07:56

As Chinese enterprises face growing challenges, they need more help to develop core competitiveness, a senior banker said on Saturday.

"At present, domestic enterprises, especially private ones, are confronted with significantly increasing difficulties and growing operation risks while rewards keeps declining," Chen Yuan, president of China Development Bank, told a meeting of China Enterprises Investment Association.

Chen was elected as the new head of the association on Saturday.

He said, "private enterprises are under unprecedented pressure as foreign investments have flooded in China following the country's reform and opening-up in the past decades".

"More help should be provided for these enterprises to upgrade industrial chains, access more overseas resources and form core competitiveness so as to fit in the new market environment," Chen said.

Chi Jianxin, chief executive officer of China-Africa Development Fund, said that it is more important for China's private enterprises to enhance competitiveness in the overseas market than at home.

"It's a global market now. China's boosting of private businesses actually aligns with its encouragement of going abroad," Chi said.

Private enterprises accounted for 62.2 percent of deals of overseas mergers and acquisitions in the first nine months of this year, compared with 44 percent in 2009, and surpassed the share of State-owned enterprises for the first time, according to a recent report from the accountant firm Deloitte. However, private businesses only made up 15.1 percent of the value of overseas mergers and acquisitions from January to September, the report said.

Data from the Ministry of Commerce showed that China's non-financial outbound direct investment reached $58.17 billion from January to October, up 25.8 percent from a year earlier.

"As overseas business keeps expanding, Chinese enterprises now have a stronger demand for protecting their overseas investments and assets," said Xu Yuanzhe, deputy head of the association.

"The association will have a new mission from now on, that is helping Chinese enterprises with overseas investments with services of risk and security evaluations as well as measures of precaution. The aim is to enhance the survival ability of Chinese companies in the overseas market and protect their interests," Xu said.

These services range from general information about society, human environment and safety updates to specialized safety reports, risk analysis and precaution alerts. The association said in a statement that it also wants to train companies' managers about overseas project safety, electronic security, information protection and consulting safeguards.

lijiabao@chinadaily.com.cn

Hot Topics

Editor's Picks