In the protracted negotiations to end the US-China trade war, high on Washington’s list of demands has always been that Beijing remove state subsidies for its dominant state-owned enterprises. In addition to more than 100 industrial conglomerates, China’s 55,000 other state-owned enterprises (SOEs) under local government control remain the backbone of many local economies.
Even as it tries to move up the industrial value chain, the employment and social stability brought by these companies – often in traditional sectors – means that scrapping subsidies is one issue on which China is unlikely to give much ground in talks with the United States.
Even as it tries to move up the industrial value chain, the employment and social stability brought by these companies – often in traditional sectors – means that scrapping subsidies is one issue on which China is unlikely to give much ground in talks with the United States.
