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Private investment urged for old industrial base
By Meng Yan (China Daily)
Updated: 2004-05-27 08:38

"The private sector could play a very positive role in solving the problems that the old industrial base is now facing,'' said Huang Mengfu, chairman of the All-China Federation of Industry and Commerce, also known as China's Chamber of Commerce.

He identified some of the problems as poor marketability, degradation of leading industries in the cities that heavily rely on resources and slow industrial restructuring overall.

State-owned and large-scale enterprises are dominating the old industrial base.

Lack of flexibility and adaptability of these enterprises in their operations have made it difficult for the regrouping of enterprises and reallocation of resources, said Huang, who is also vice-chairman of the 10th Chinese People's Political Consultative Conference National Committee.

He said encouraging and promoting the development of the non-public economy will effectively push the strategic restructuring of the State-owned economy.

Huang said he expected the private sector entrepreneurs to be fully aware of the business opportunities in the revitalization of the old industrial base.

"The fast-developing infrastructure construction in the northeast will bring the private sector chances to enter this field,'' he said, referring to rural road reconstruction, construction of public facilities in cities, development of electronic resources, large-scale projects involving water resources and railway construction.

Huang said the private enterprises could focus on agricultural industrialization and the development of forestry, e-commerce, chain-store operation and logistics in which they have accumulated significant experience.

They could also become involved in manufacturing, the environmental protection industry and service industries including banking, securities and insurance, as well as information and intermediary services, he added.

Noting that pressures on social security and employment are major problems the industrial base is facing, Huang said the most direct and efficient way to solve these problems to encourage the laid-off workers to join private enterprises or create their own businesses.

Huang was speaking at the fourth session of the federation's standing committee which was held Wednesday in Shenyang, capital of Northeast China's Liaoning Province.

There had been over 3 million private enterprises in China, with 7.72 million investors and 350 million yuan (US$42 million) worth of registered capital by the end of last year, according to statistics from the State Administration for Industry and Commerce.

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