China’s National Oil Companies ‘Go Global’

Abstract

China’s large SOEs operate in the commanding heights of the economy, that is, mostly in the strategic sectors such as energy and power, industrial raw materials, military industry, large-scale machinery building, transport, banking and telecommunications. These SOEs are centrally-administered and guarantee China “a stable supply of energy and main industrial inputs such as steel and chemical materials, safe financial operations, a smoothly operating transportation system, fast-growing communication services across the country, continued progress in high-tech industries, and a substantial increase in automobile production” (Liu 2009: 546). The strategic sectors of the Chinese economy play a vital role not only in economic growth but also in economic transformation; they are frequently used by the central party-state in order to pursue a range of industrial, social and political objectives. Beijing’s focus on reforming and growing the state sector has led scholars such as Huang (2008: 277) to conclude that China is now best characterised as a commanding heights economy, with private enterprise squeezed out of many industries that receive extensive government support.