Shanghai’s state-owned businesses in 800 billion yuan push to restore city’s economy
Businesses controlled by Shanghai’s municipal government have pledged to plough 800 billion yuan (US$120.7 billion) annually into industries like hi-tech manufacturing in the next five years in the city’s latest push to regain its status as the mainland’s economic juggernaut.
Jin Xingming, director of the Shanghai State-owned Assets Supervision and Administration Commission, told a press conference on Thursday that the state-owned enterprises would also become the main force behind technological advances as Shanghai strives to become a global innovation hub.
“The commission let the companies use one third of their net incomes to invest in innovation,” he said. “The funds will lead to follow-up investments in the future and result in more capital inflows from the investing public.”
The overall trend is that state-owned businesses will also need to compete with public funds to secure lucrative investment deals
The annual 800 billion yuan investment by about 12,000 state-owned businesses under the oversight of Shanghai’s government represents more than double their 323 billion yuan of profits in 2016.
Aside from hi-tech and manufacturing businesses, the funds will also be used to support the city’s infrastructure projects and service industry.
Top state-owned companies controlled by the local government include SAIC Motor, the mainland’s largest carmaker by sales volume, and Shanghai Shendi Group, the Chinese partner of Shanghai Disneyland.
Jin said emerging industries will be a primary target by the state-owned firms, without disclosing an exact amount of potential investment.