China to break up state power giant

sol dollinger soldoll at inreach.com
Fri Apr 6 10:43:21 MDT 2001


At 05:49 PM 04/06/2001 +0530, you wrote:
>Tuesday
>3 April 2001
>
>China to break up state power giant
>BEIJING: China will break up its state-owned power behemoth in an ongoing
>bid to spur competition and to offload government shareholdings in the
>sector, the official China Daily newspaper said on Monday.
>State Power Corp (SP), which owns all of China's high-voltage grid assets,
>will be stripped of its power generation assets in preparation for a
>possible overseas listing as the country's sole grid operator, the paper
>said.
>State Power's generating assets -- which make up half of the country's total
>power plants -- will be split into regional power generating companies that
>are likely to seek separate stock market listings.
>"A raft of power company listings is foreseeable," said Wang Jun, director
>of the State Development Planning Commission's power department.
>Premier Zhu Rongji said in March that China would draft new laws to
>facilitate the break up of monopolies in industries such as power,
>telecommunications, civil aviation and railways.
>The reforms aim to help China establish a more market-oriented economy as it
>prepares for entry to the World Trade Organisation, expected later this
>year.
>By bringing individual power producers to the stock markets, the Chinese
>government aims to spur competition in the heavily monopolised sector and
>reduce its stakes in the businesses at the same time.
>With its exclusive power transmission rights and ownership of half of
>China's power plants, State Power has left little room for independent power
>plants to compete, the paper said.
>If the government sold half of its shares in the power sector -- with 800
>billion yuan ($96.4 billion) in assets -- it could raise up to 400 billion
>yuan ($48.2 billion) in cash sorely needed to supply the country's social
>security fund, said Hu Angang, director of the Chinese Academy of Sciences'
>Research Centre for China Study.
>Each proposed power generating company would take a stake in separate power
>plants to avoid a monopoly in any region, Wang said. (Reuters)
>  For reprint rights:Times Syndication Service




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