Chen Wenjun:

Thank you, Mr. Zhang. The floor is now open for questions. Please identify the media outlet you represent before asking your questions.

CCTV:

The 20th CPC National Congress drew up an ambitious blueprint for building a modern socialist country in all respects and advancing the great rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization. What are the new missions and tasks for SOEs, especially centrally administered SOEs, in the process of modernization through a unique Chinese path?

Zhang Yuzhuo:

Promoting high-quality development is an essential requirement of Chinese modernization. The SASAC and central SOEs will make high-quality development their top priority. So, to summarize, we will focus on "one goal" and "two paths."

"One goal" means we will strengthen, expand, and increase returns on state-owned capital and SOEs. This is in response to the important arrangement made by General Secretary Xi Jinping and the CPC Central Committee on SOEs, including central SOEs, and to the expectations of all the Chinese people for the SASAC and central SOEs. Also, we set the goal considering that SOEs hold an important position and play a key role as the material and political foundations of socialism with Chinese characteristics. In addition, they are an important pillar and source of strength for the Party to count on in governance. 

"Two paths" means that, on the one hand, we need to increase our core competitiveness; on the other hand, we need to strengthen essential functions through optimal distribution and structural adjustments. To improve core competitiveness, there are four keywords on which we need to concentrate. First, technology. We will focus our efforts on sci-tech self-reliance and self-strengthening, establish cradles for original technologies, and improve the capabilities of basic research and application-oriented basic research at a faster pace. We will also tackle problems in core technological research that hinder the country's development, improve the input-output efficiency of research and development (R&D) investment, and constantly make breakthroughs in increasing the efficiency of our innovation system to ensure that enhanced sci-tech capabilities will further strengthen enterprises, industries and the economy. Second, efficiency. We will give better play to the guiding role of assessment based on a target management system of operational indicators, including total profits, debt-to-asset ratio, return on equity, per capita labor productivity, the ratio of R&D spending to revenues, and the ratio of net cash flow to revenues. We will also strengthen lean production management and increase operational efficiency to improve quality effectively and reasonably increase quantity. Third, talent. We will continue cultivating and making good use of talents and actively participate in the country's establishment of highlands and platforms for high-level talent gathering to cultivate greater numbers of master scholars, science strategists, first-class scientists and innovation teams, young scientists, outstanding engineers, master craftsmen, and highly-skilled workers. Fourth, branding. We will strengthen brand management to realize a transformation from "Made in China" to "Created in China," from "Chinese speed" to "Chinese quality," and from "Chinese products" to "Chinese brands."

To strengthen essential functions, we will focus on optimizing distribution and structural adjustments to consolidate the controlling role of the state-owned sector in major industries and key fields vital to national security and comprise the economy's lifeline. We will also intensify efforts to strengthen the development of the innovation capability system and the layout of new strategically emerging industries. We will also increase support for public service systems to give better play to the state-owned sector's leading and strategically supporting role.

Meanwhile, we will uphold the Party's overall leadership and strengthen Party building in enterprises. We will make efforts to advance a new round of SOE reform and strengthen state-owned assets supervision and administration to provide significant political and institutional guarantees for promoting the high-quality development of SOEs and moving faster to help Chinese companies become world-class entities.

Thank you for your question.