From Chinese Press

PetroChina needs introspection

(China Daily)
Updated: 2010-06-01 07:48

A Chinese company, PetroChina, has topped the list of Financial Times' (FT) 500 most valuable listed companies. But this crown is encrusted with some sordid diamonds, says an article on qq.com. Excerpts:

PetroChina and the other 20 Chinese companies on the list of 500 most valued firms are State-owned enterprises, that is, they belong to all Chinese people. The owners' economic status, however, has been lagging far behind their companies.

The most-valuable tag for a company does not necessarily mean it is also an industry leader. In reality, too, PetroChina is not. Its profit in 2008 was only one-third of Exxon Mobil, which is ranked second in the (FT) list, and its 3-billion-ton reserve is trivial compared to about 36-billion-ton reserve of Saudi Aramco. And yet it employs the largest number of people, 1.67 million, making it the poorest in efficiency.

Moreover, the ranking may further upset its shareholders on the Chinese mainland who bought its shares for about 48 yuan each only to see them nose-dive to less than 10 yuan. Most of the shareholders will need decades to recover their cost. In sharp contrast, the company's stock listing in US raised only $2.9 billion, but it has already distributed $11.9 billion in dividends.

Besides, PetroChina should thank the central government's fiscal subsidies for its top ranking instead of feeling proud of its business success. And it should reflect on whether it has been a company responsible to all Chinese people.

(China Daily 06/01/2010 page9)