China Emerging_ 1978-2008 - Xiao-bo , Wu [63]
On November 5, 2007, PetroChina successfully lists its A shares on the stock market in Shanghai. Because of its monopoly advantage, the company became the “most profitable company in all of Asia” in 2007.
the most profitable moneymaking machine in all of Asia. It surpassed the blue-chip king of the Hong Kong stock market, HSBC, and Asia’s previously most-profitable company, Toyota.
In July 2006, the Fortunemagazine announced the Global Fortune 500, and twenty-two Chinese companies were now on the list. Sinopec went from number 31 to number 23, becoming China’s premier enterprise. The State Grid Corporation of China rose from number 40 to number 32. PetroChina jumped from number 46 to number 39.
Similar things were happening in the financial arena. In May 2006, the Construction Bank, Communications Bank, Bank of China, and Industrial and Commercial Bank of China were listed on exchanges. This was warmly received by strategic international investors. It is worth noting that those international financial institutions that briskly stepped forward to board the train were quickly able to reap tremendous returns. The listings and the profits made are events that are not likely to be repeated anytime soon.
By the end of 2006, a period of “macroeconomic adjustments” that had been extended for two years finally came to an end. In the past thirty years of reform, “macroeconomic adjustments” had become a special expression in the Chinese vocabulary. This followed on from its predecessor, “enforced reorganization,” which was in vogue in the 1990s. Such adjustments now occurred on a regular basis of three to five years. The beginning was always trumpeted, but exactly when the adjustments were to end was never announced.
This time, the conclusion of the macroeconomic adjustments was fairly clear since the desired outcome had been achieved. Through strongarm administrative controls, the monopolistic position of the state-owned enterprises in certain industries was strengthened.
Since 2006, the merger-and-acquisition activity has clearly sped up. The listing of state-owned banks has been a major development. Two rather large-scale projects were completed, while one has begun. On May 20, 2006, the final concrete was poured for the main wall of the Three Gorges Dam. Twelve years of construction required some US$24 billion in investment up to that date. The dam was said to be able to produce an average of 84.7 billion kwh of electricity per year, replacing Brazil’s Itaipu dam as the world’s largest water-control and hydroelectric power project. On July 1, the Qinghai–Tibet Railway was completed. Extending 1,956 kilometers, the investment in this project came to RMB 33 billion. The railroad consisted of a stretch of 960 kilometers that was higher than 4,000 meters above sea level. It prided itself on being the highest and longest railroad in the world, built under the most extreme climatic conditions.
On June 6, the State Council issued the “Opinions regarding issues with respect to opening a Tianjin Binhai New Area.” The plan for this new regionincludedanareaof2,270 square kilometers, which was 300 square kilometers larger than Shenzhen, twice as large as Hong Kong, and three times aslargeasPudong.BinhaiNew Area was to become the new financialcenterofthenorthern part of China. People considered it as important as Shenzhen in the 1980s and Pudong in the 1990s. A Xinhua News Agency editorial applauded the news, “Shanghai’s Pudong, Shenzhen City, and Tianjin’s Binhai New Area are becoming the three engines in China’s comprehensive reform.”
On November 20, 2006, the Shanghai Exchange index broke through the benchmark figure of 2,000, after staying
The Three Gorges Dam is the largest engineering project ever undertaken