On 15th February of 2012, several fundamental policies for economic reform of China in 2012 have been settled down through the Executive Meeting of the State Council (hereinafter referred to as “the Meeting”). To promote the development of diverse forms of ownership, push reforms of strategic adjustment of state-owned economy and turning state-owned enterprises into standard joint-stock companies, to improve and implement the policies and measures in order to promote development of non-public ownership economy, encouraging private capital to enter the railway, municipal, financial, energy, telecommunications, education, medical and other fields. The above slogans have been highlighted in the Meeting.
Meanwhile, the Meeting also concluded 5 priority areas and crucial links that the reform on economic structure of China should focus on, among them deepening the reform of monopoly industries has been depicted as the primary task. As a matter of fact, early in the panel discussion previously held by the Premier Wen Jiabao from 6th to 10th of February, Wen Jiabao emphasized, after listened to the views from all circles of the society on the Draft Government Work Report, that pushing reforms on the monopoly industries forward is the priority of reforms of economic structure in the current phase for China. Mr. Wen also made a clear expression that the expected “New Thirty-six rules” enforcement regulation must be adopted in the first half of this year.
According to a source close to NRDC, part of the “New Thirty-six rules” on allowing private capital to enter into monopoly fields has been finalized, however, it is still unknown that when the rules would be made public and what would be the practical effect of the “New Thirty-six rules”, which remains subject to the test of market. The same source expressed in a further degree, “With regards to the long-standing ‘glass door’ in front of monopoly industries, we should make most efforts on the policy design on one hand, but the shift on conception and consciousness of governmental departments is equally significant on the other hand.”
With respect to which areas are monopoly industries in China, Article 7 of AML generally answered the question and it reads that , the State protects lawful business activities of undertakings in sectors that affect the national economic lifeline and state security and are controlled by the state-owned part of economy as well as sectors in which exclusive operation and exclusive sale are implemented……Per AML, theoretically speaking, sectors that affect the national economic lifeline and state security and controlled by the stated-owned part of economy mainly included two types of sectors: natural monopoly industries and policy monopoly industries. The former includes industries such as telecommunication, energy, water, aviation and railway, etc and the latter is mainly determined in compliance to periodical policies of the state due to considerations such as national defense, politics, foreign trade, etc. As to sectors in which exclusive operation and exclusive sale are implemented, tobacco and salt industries, for example, belong to this group in the present time.
The slogan of promoting reforms on monopoly industries also reminds people of the big event in Telecommunication industry, happened last year. That is, NRDC commenced the official investigation on China Telecom and China Unicom, on the ground that they are suspected as abuse of dominant position. Now the settled down policies have been formally laid on the paper, people cannot help guessing which would be the next sector and who would be the next target and so on. It also causes panic among big giants in other industries.
It is also anticipated by many domestic and international commentators that, reforms in monopoly industries of China in 2012 would make people impressive.