Rethinking Of The Contracted Management Of The State-owned Capitals

State-owned assets are essential to the nation's economy. State-owned capital (operational state-owned assets) accounts for 66.91% of all the State-owned assets local state-owned capital accounts for 52.2%. Large numbers of small and medium size state-owned corporations, which are very important to the local operation of state-owned assets, are widely scattered. In respect of the assets, capital and production value, they constitute 1/3 of the nation's economy. Thus the success of the operation of the state-owned capital largely depends on management of the local small and medium size state-owned corporation. That is why during the 20 years' reforming and opening, 'open and activate the small and medium size state-owned corporations ' has always been emphasized by the state and the party. However, despite for the many explorations as to the operation mechanism of the small and medium size state-owned corporations that have been made in the practice, inefficient operation and loss of the state-owned assets still exist. According to the spirit of the interim meeting of the 16th party convention, different small and medium size state-owned corporations will have different future in the next few years. 1.Those qualified will be transformed t o s tock c orporations. 2 .Those i n a ccordance with t he d rop o ut condition will be sold out. 3.Others shall become more competitive through self-improvement. Notwithstanding, we shall be aware that large numbers of small and medium size state-owned corporations with lots of employees and technologies that is out-of-date are widely scattered not only geographically but also over all kinds of industries, which make stock-transformation and sold out impossible to be completed within a short period of time. During the transitional period, we should adopt efficient operation modes to maintain andincrease the value of the state-owned assets.The transitional operation mode used in the small and medium size state-owned corporations shall fit for their characters and developments. Contracted m anagement, which w as q uite p opular i n t he 1 arge and m edium state-owned corporations in 1980s and 1990s, is a convenient and adaptive state-owned operation mode. Can it be used in the small and medium size state-owned corporations? That will depend on the summarizing and innovation as to the contracted management both practically and theoretically. This dissertation will start with the contracted management's history and its inevitability in our times. The rationale and methodology is to base the detailed analysis of the contracted management, related theories, regulations and the market on the practical experience. Possible improvements of the contracted management of the state-owned assets will be discussed. The conclusion of this dissertation is that contracted management is a convenient and adaptive mode that could successfully accomplish the separation of the ownership and the management of the state-owned capitals. It does fit for the small and medium size state-owned corporations during the transitional period. We may face difficulties while implementing the mechanism of contracted management. However, with the major break through in the reform of administration of the state-owned property and the formalization of the country's market, improvement of the mechanism can be consummated. Finally, the laws and regulations shall be modified to protect all the improvement and innovation.The modification of the Jaws and the regulations lies in the restructure of the legal relationship involved in the contracted management. It is crucial to clarify the subject, object and content as well as the rights, responsibilities and profits that may arise The restriction upon the exercise of the subject's power and responsibilities shall be emphasized. As to what constitute the object of the contracted management, is it the profit, state-owned properties or the state-owned capital? Regarding 'profit' as the objective, in many cases, may lead to the operation without long-term consideration and...