BEIJING (XFN-ASIA) - A government minister has warned the country's 150
large state-owned enterprises (SOEs) to brace for tough economic times ahead,
according to a report in the Economic Observer newspaper.
"Please keep a close watch on your purses and do not splurge," Li Rongrong,
minister of the State-Owned Assets Supervision and Administration Commission
(SASAC) was quoted as saying.
Li gave his warning in a speech to SOE bosses on April 24, but the speech
was made public only on Friday.
To fend off the challenges, Li warned companies to be more careful about
borrowing and urged them to keep more money on hand, according to the report.
In the operational budgets of the 150 SOEs, 67 companies said they would
borrow more this year for expansion, and some companies were even planning
asset-liability ratios of up to 80 pct.
A total of 38 companies said they had negative working capital in the first
quarter.
Some of the SOEs have reported a slowdown in profit growth in the first
quarter. They booked revenues of 2.6 trln yuan, up 27 pct year-on-year, but
their profits declined by almost 3 pct over the same period.
beijing@marketnews.com
-
xfntm
COPYRIGHT
Copyright Thomson Financial News Limited 2008. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content,
including by framing or similar means, is expressly prohibited without the prior
written consent of Thomson Financial News.
|