Lessons for Africa in Chinese SOE Governance

The document examines China's four waves of SOE reform since 1978, highlighting the use of market competition under state ownership and mixed governance. It argues that while China's unique political system makes direct replication difficult, African nations can adopt tactical lessons such as using quality global exchanges for IPOs, creating competing state-owned units to monitor management, and ensuring durable compensation for workers displaced by reform. The author emphasizes that state capacity and institutional design must precede large-scale ownership reform.

• China's SOE governance has evolved through four distinct waves since 1978: gradual autonomy in the 1980s, mass-scale rationalisation in the 1990s, governance experimentation via public listings in the 2000s, and the pursuit of 'dynamic state capitalism' since 2013.
• A central pillar of Chinese SOE governance is the use of competition between different state-owned entities to allow the state to monitor and discipline management performance.
• To professionalise management and introduce external constraints, China utilised initial public offerings (IPOs) on high-quality global exchanges (such as the New York Stock Exchange) and sought strategic industry investors like BP and Vodafone.
• The State-Owned Assets Supervision and Administration Commission (SASAC) and the China Investment Corporation (CIC) mitigate political capture by reporting to the State Council as a whole rather than a single individual.
• Successful mass-scale rationalisation of SOEs in the 1990s was only possible because the government prioritised concrete, asset-based compensation for displaced workers, such as granting ownership of their apartments.
• For African contexts, the author recommends tactical steps including mandating infrastructure SOEs to invest in other African markets to enable comparative performance monitoring and avoiding reporting lines to single sectoral ministries to prevent capture.

APA

Jordan, L. (2021). Lessons for Africa in Chinese SOE Governance. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2021/08/Policy-Insights-116-jordan.pdf

Chicago

Jordan, Luke. Lessons for Africa in Chinese SOE Governance. South African Institute of International Affairs, 2021. https://saiia.org.za/wp-content/uploads/2021/08/Policy-Insights-116-jordan.pdf.

Wikipedia

{{cite report |last1=Jordan |first1=Luke |title=Lessons for Africa in Chinese SOE Governance |publisher=South African Institute of International Affairs |date=July 2021 |url=https://saiia.org.za/wp-content/uploads/2021/08/Policy-Insights-116-jordan.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{jordan2021lessons, author = {Jordan, Luke}, title = {{Lessons for Africa in Chinese SOE Governance}}, institution = {South African Institute of International Affairs}, year = {2021}, month = jul, url = {https://saiia.org.za/wp-content/uploads/2021/08/Policy-Insights-116-jordan.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }