Analysis of Losses Incurred by State-Owned Industrial Enterprises Included in the State Budget, and Proposed Countermeasures

Abstract

From 1979 to 1986, state-owned industrial enterprises realized a total of 852.5 billion yuan in profits and taxes at an average annual progressive increase rate of 6.8 percent. This amount equalled the sum of profits and taxes realized in the previous twenty-six years. Their contributions constituted 80 percent of national financial revenue and played a major role in the development of the national economy. On the other hand, it should also be pointed out that state-owned industrial enterprises have always sustained relatively big losses. This problem has become more serious in the past two years and is now a major impediment to the improvement of industrial economic results in the country. To reverse this situation as quickly as possible and create more favorable conditions for deepening reform, it is necessary to make an overall analysis of these losses and arrive at some solutions.