accelerate innovation and transition through
reform. A disposal platform for inefficient assets
should be created to promote their repackaging and
restructuring. Financial policies to reduce capacity
should be used to their full extent. The ability to exit
capital should be made easier and in conformity
with market principles by leveraging the reforms to
the state-owned capital investment management
system and through mixed ownership.
4.7 Speed Up Reform of State-Owned
Energy Companies
4.7.1 Accelerate Reform
of State-Owned Energy
Companies by Improving
Investment Efficiency
The government’s responsibilities as the investor
of state-owned capital should be defined to
achieve a shift from corporate management to
capital management. Within the framework of
reforming the state-owned capital management
system, state-owned energy companies should
set up state-owned capital investment and operations companies as soon as possible. They
should also establish modern corporate systems
and internal mechanisms adapted to the new
management system and carry out mixed
state-private ownership reforms.
4.7.2 Help State-Owned Energy
Companies Become
Stronger and More
Competitive
To ensure national energy security and social stability, state-owned energy companies have a social
responsibility to become stronger and better. They
should make the most of the country’s strong
industrial base. Issues such as high interest on debt,
weak operational ability and low profit margins
should be resolved to strengthen their businesses
and improve their global competitiveness.
4.7.3 Make Reform Breakthroughs
by Tackling Key Issues
First, a mechanism for state-owned capital’s exit
from inefficient and ineffective energy assets
should be created. State-owned energy companies could limit losses by exiting state-owned
capital to become leaner and fitter. The central
government, local government, businesses and
the general public should work together to
resolve the issues of “where will the laid-off
workers go, how will the debt be paid, and how
will the value of assets be managed”.
Second, the pace of reform in the power and oil
and gas industries should be accelerated. A dynamic and unified market system should be created by eliminating the impact of existing interests
on conventional businesses. Energy market
supervision and regulation should be rapidly
introduced to improve energy supply capability.
Third, the investment management capability of
state-owned energy companies should be
improved, and the investment function of
state-owned capital given full play. More people
should be employed by state-owned energy companies, especially those with capital investment
experience. To help state-owned energy companies
become dynamic, their internal management systems should be optimised and incentives increased.
Fourth, mixed ownership reform should be
deepened. Given the strategic significance of the
energy sector, state-owned holdings will continue to exist in the long term. But investment
openness and collaboration between state-owned
and private capital should be realised at different
levels and in different ways. Most importantly,
the different capital governance and management
mechanisms that apply to public and private
companies respectively should be aligned.
4.8 Enhance China’s Engagement in
Global Energy Governance
4.8.1 Develop Strategies for,
and Engage Deeply in,
International Energy
Governance Organisations
It is in China’s interests to firmly adhere to
multilateral norms and international rules, seize
opportunities and address challenges together
with the international community, and actively
participate in global energy governance.
Overview: High-Quality Energy for High-Quality Growth …
37
reform. A disposal platform for inefficient assets
should be created to promote their repackaging and
restructuring. Financial policies to reduce capacity
should be used to their full extent. The ability to exit
capital should be made easier and in conformity
with market principles by leveraging the reforms to
the state-owned capital investment management
system and through mixed ownership.
4.7 Speed Up Reform of State-Owned
Energy Companies
4.7.1 Accelerate Reform
of State-Owned Energy
Companies by Improving
Investment Efficiency
The government’s responsibilities as the investor
of state-owned capital should be defined to
achieve a shift from corporate management to
capital management. Within the framework of
reforming the state-owned capital management
system, state-owned energy companies should
set up state-owned capital investment and operations companies as soon as possible. They
should also establish modern corporate systems
and internal mechanisms adapted to the new
management system and carry out mixed
state-private ownership reforms.
4.7.2 Help State-Owned Energy
Companies Become
Stronger and More
Competitive
To ensure national energy security and social stability, state-owned energy companies have a social
responsibility to become stronger and better. They
should make the most of the country’s strong
industrial base. Issues such as high interest on debt,
weak operational ability and low profit margins
should be resolved to strengthen their businesses
and improve their global competitiveness.
4.7.3 Make Reform Breakthroughs
by Tackling Key Issues
First, a mechanism for state-owned capital’s exit
from inefficient and ineffective energy assets
should be created. State-owned energy companies could limit losses by exiting state-owned
capital to become leaner and fitter. The central
government, local government, businesses and
the general public should work together to
resolve the issues of “where will the laid-off
workers go, how will the debt be paid, and how
will the value of assets be managed”.
Second, the pace of reform in the power and oil
and gas industries should be accelerated. A dynamic and unified market system should be created by eliminating the impact of existing interests
on conventional businesses. Energy market
supervision and regulation should be rapidly
introduced to improve energy supply capability.
Third, the investment management capability of
state-owned energy companies should be
improved, and the investment function of
state-owned capital given full play. More people
should be employed by state-owned energy companies, especially those with capital investment
experience. To help state-owned energy companies
become dynamic, their internal management systems should be optimised and incentives increased.
Fourth, mixed ownership reform should be
deepened. Given the strategic significance of the
energy sector, state-owned holdings will continue to exist in the long term. But investment
openness and collaboration between state-owned
and private capital should be realised at different
levels and in different ways. Most importantly,
the different capital governance and management
mechanisms that apply to public and private
companies respectively should be aligned.
4.8 Enhance China’s Engagement in
Global Energy Governance
4.8.1 Develop Strategies for,
and Engage Deeply in,
International Energy
Governance Organisations
It is in China’s interests to firmly adhere to
multilateral norms and international rules, seize
opportunities and address challenges together
with the international community, and actively
participate in global energy governance.
Overview: High-Quality Energy for High-Quality Growth …
37