Decades of rapid growth in China during the development and prosperity of the private sector once they are out of the backward and inefficient state-owned enterprises. Now, from the World Bank’s latest data show that last year the proportion of state-owned enterprises in industrial production is rising. In addition, the state-owned holding company received substantial government support and state-owned bank loans to address the financial crisis, the company stock price soaring.

Management of state-owned and private enterprises in China is a difficult problem. After several decades of economic reform, many large state-owned business seems really competitive, government leaders publicly emphasizing ownership is no longer involved in the ideological Cibie. But they never relax state control of strategically important part of the industry, including finance, defense, energy, telecommunications, railways and ports.

Associate professor of political science at Northwestern University Shizong Han (Victor Shih) in a recent telephone interview, said, “China has been more industrial policy. However, the policy implemented a few years, China seems to dislike actively look interference industries prefer to let go of the implementation of Measures. ”

20th century reform of the release of 80 private enterprises, the reform of the dissolution of 90 years a large number of state-owned enterprises.

“The problem is that 90 years from 1978 to the end of the first 20 years of reform did not actually touch the authority of government,” Center for Economic Research of Peking University, Professor Yang Yao said. “So after the reform, in fact, the government is expanding, because there is no checks and balances of power.”

No comprehensive statistics sum up the impact on the economy. In a sense, everyone agrees, China’s economy is divided into two parts: Yifang Mian, strong and competitive private sector in the assembly shop, clothing and food exports to dominate. Higher level of financial, communications, transportation, mining and other industries, the government has majority ownership.

However, the two camps very different views on China’s future. That the state-owned enterprises were no signs of expansion, that intervention is not too much but too little. Skeptics who think that state intervention caused considerable distortion and waste, resulting in serious misallocation of capital.

“In 2009, the government in the business area of huge expansion,” MIT Sloan School of Management Tenure Yasheng Huang said in a telephone interview. “They produce yogurt. They enter the real estate. Upstream to the downstream state-owned enterprises are now expanding downstream business as a vertical unit to organize them. They are only operating on a larger scale enterprises.”

Yasheng Huang said that at the local level, in 2009 the government set up a 8000 state-owned investment company, to guide the government dollar reserves into the commercial and industrial enterprises. For example: private car company of Zhejiang Geely Holding Group’s acquisition of Ford’s Volvo brand, in March as the world’s headlines. 1.5 billion acquisition of funds, most of the profits not from auspicious, but the Northeast and the Shanghai local government funding.

China’s private entrepreneurs have such a mantra: “the people back into the country.”

Countries to promote greater participation of business for different reasons. Control of the energy supply is essential to China’s development, but also in other areas pursuing the interests of the government seem.

In telecommunication industry. When China joined the World Trade Organization commitment to open communications market, commitment to open local and international telephone services, e-mail and other services. 8 years later, China’s basic telecommunications boom, but the state-owned holding companies accounted for almost one hundred percent of the market.

Which means, but more successful, it is difficult to settle. Some economists praised the success of China’s top-down strategy. South Korea and Japan and other Asian countries to help build strong use of a powerful modern economy. Many economists believe that markets in developing countries, more government involvement may be better than relying on market forces.

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