Half of major SOEs' profits set to be made from abroad

Updated: 2013-07-30 00:56

By BAO CHANG (China Daily)

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Samsung Electronics began its internationalization drive as early as the 1970s by continuously establishing sales networks and production bases in major markets such as the United States, the United Kingdom, Mexico and China.

As a result, Samsung accounted for 23.6 percent of the world market for mobiles in the first quarter of this year, the leading position globally, according to US market research firm Gartner Inc.

China National Petroleum Corp, with assets worth more than 3 trillion yuan ($488.7 billion), overtook Exxon Mobil and Royal Dutch Shell in value last year. But its overseas revenue accounted for only 20 percent of its total income, compared with about 70 percent for Exxon Mobil and Shell.

Huang Shuhe, the commission's vice-chairman, said earlier that Chinese SOEs should follow the example of major multinationals in their global expansion.

But Kang said it will take a long time for Chinese companies to increase their international competitiveness.

Currently, many central SOEs focus on the acquisition of foreign assets to expand their international reach. But Kang said they can generate more profits from "an optimized network layout", a complete industry chain and business operations that directly serve customers in foreign markets.

One example is China National Offshore Oil Corp, which acquired Canadian energy group Nexen in February.

The State-owned oil and gas producer plans to list its shares in Canada and establish its North American headquarters in the country, reflecting a new strategy for Chinese SOEs investing abroad.

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