A millionaire private businessman known as the 'Hot Pot King' estimates that the private sector already accounts for a third of Chongqing's economy and is expected to account for half within three years. Liao Changguang is chairman of Chongqing Cygnet Diet Culture Group, with assets of more than 100 million yuan (about HK$93 million), including hot pot restaurants in China and the United States, 19 performing troupes, hotels and a holiday resort village. 'It is the private sector that is absorbing thousands of workers laid off by the state sector, while no new state firms are being set up,' he said. The private sector has grown at a very fast rate and already accounts for one third of the city's gross domestic product, he said. 'It is most likely that it will account for half within three years,' Mr Liao said. Government estimates put the share of the private sector at less than 10 per cent but officials admit many private firms conceal their ownership structure and present themselves as collective or other kinds of companies to avoid political or official trouble. The city government itself admits the chief reason its economy lags other cities is an underdeveloped private sector. City Communist Party chief Zhang Deling said last year that the city's state sector was too big, accounting for about 70 per cent of GDP. Such irrational ownership structure was one important reason why Chongqing's economic development had been slow, he said. As a sign of the government's growing recognition of the importance of the private sector, Mr Liao was chosen as a city deputy to this year's National People's Congress, the only private businessman among 51 Chongqing delegates. The government is relying on private firms, most of them more dynamic and profitable than state ones, to absorb laid-off workers. Last year private firms in the city bought 160 state-owned companies and leased a further 2,000, creating 16,000 jobs. According to official figures, Chongqing has 420,000 laid-off urban workers and 10 million surplus farm labourers out of a population of 30 million. Many people consider the laid-off figure too low. Mr Liao's group, which employs 5,000 people, has taken on many laid-off workers, although he denies any government pressure to do so. Mr Liao said that he would raise at the NPC next month the unequal treatment private firms received in their attempts to take over state firms. Mr Liao backed state and city government policies, saying there was no bias against the private sector. But he said that low- and mid-ranking officials failed to implement the policies because they were too conservative and prejudiced against private firms. The Hot Pot King said he had abandoned a bid to take over two state firms because the State Asset Management Bureau had refused to approve his acquisition of the land on which they stand. With the abolition of credit quotas, state banks are increasingly treating private sector clients on a proper commercial basis, although there remains a problem of attitude among some bank officials, Mr Liao said. Mr Liao is preparing an A share listing for his country-wide chain of 34 Hot Pot restaurants and plans to raise 150-160 million yuan, most likely next year. The China Securities Regulatory Commission has approved only a handful of listings by private companies while 30 more have obtained listings by taking over state firms that were already listed, brokers said. An official of Wanmeng Investment Management Co, which is handling the listing, said the selection system was increasingly market-driven, with asset quality the most important criterion. 'My firm is handling listing applications by half a dozen private companies,' the Wanmeng official said. 'We see Liao's hot pot chain as the McDonald's of China.'