Reforming the Chinese State Sector: Mixed Ownership Reforms and State-Business Relations
The Third Plenary Session of the 18th Chinese Communist Party Congress in 2013 marked the beginning of the current fourth stage of state-owned enterprise (SOE) reforms in China. This time, the state’s efforts to improve SOE financial performance hinged on attracting private capital to take ownership shares in state firms – or so-called mixed ownership reforms. This new research article offers a detailed analysis of the policy design of this fourth round of SOE corporate restructuring. It relies on an analysis of policy documents, interviews with policy experts in China, and a case study of local mixed ownership reform implementation in the city of Nanjing. It argues that the reform agenda consolidates a Party-led state capitalist model emerging under Xi Jinping and, in that context, discusses some implications of mixed ownership for corporate governance amid changing state–Party–business relations in China. This model envisions continuing market-orientated reforms in combination with increased state control over the direction of the economy. Current state sector reforms thereby cement an evolutionary process towards a particular hybrid political-economic system that organically blends planning and market modes of economic coordination, as well as public and private modes of ownership.