From the Sunday Times:
As he promotes Western-style notions of governance in China, Thornton faces a business culture in transition. The government, run by the Communist party, still controls a vast swath of the economy and has no intention of giving up its control ” particularly in strategic industries such as telecommunications. The government owns 75% of China Netcom.
However, policymakers also believe that Chinese companies will perform better if they are exposed to the demands of international investors, just as companies in the West are. That is why Beijing has encouraged its biggest and best companies to list their shares in New York, Hong Kong and London, even though the companies usually don’t have an immediate need for funds.
Zhang and Thornton are trying to walk tightrope ” they have to keep the Communist party in control, but respect the rights of the foreigners who now own a chunk of corporate China. [Full text]
