BEIJING, March 4 China must make room for
private investors in sectors including railway, energy and
finance over the next five years, a member of its
decision-making Politburo Standing Committee was quoted as
saying by Xinhua news agency.
The remarks by Zhang Gaoli, calling for more support to be
given to the private sector, tacitly acknowledged Beijing's grip
"Breakthroughs must be made" to let private capital into
industries, Zhang was quoted as saying before China's annual
parliament session begins on Tuesday, when private investors are
set to lobby for greater access to state-controlled businesses.
Economists warn that China can no longer delay freeing key
sectors to let in private investment, especially if it wants its
economy to keep growing between 7 to 8 percent in coming years.
The stress placed on state-owned banks that have funded most
of China's rapid urbanisation to date has heightened the urgency
to let private capital soak up some financing burden.
Despite generating 60 percent of economic growth and
creating three out of four jobs, China's private firms are
marginalised compared to their state rivals, who enjoy subsidies
such as cheap bank loans and land.
Frustrated by their disadvantages, a group of private
businessmen are preparing to meet on the sidelines of China's
parliament meeting in the next 10 days to push for greater
privatisation, a person with knowledge of their plans said.
Zhang's latest remarks would be a welcome but it is far from
clear if they signal genuine appetite for change from the
Despite repeatedly promising greater privatisation, Beijing
has supported the expansion of China's state-controlled sectors
in the past decade.
The financial sector, for example, is majority-controlled by
Beijing despite a series of high-profile stock market listings
by China's largest banks in the mid-2000s.