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U.S. Trade with China: Selected Resources

Chinese State-Owned Enterprises

Underwood & Underwood. View along the Bund, from Municipal Council Building - Hankow, Interior China's greatest tea port. c1900. Library of Congress Prints and Photographs Division

Achieving predominantly “market economy conditions” with removal of price controls and allowing market forces to be the predominant factor in trade flows was one of China’s obligations prescribed by the WTO Protocol of Accession. Although private sector has been growing steadily, the Chinese economy hasn’t transformed into true market economy. The Chinese government controls a large number of state-owned enterprises (SOEs) that dominate strategic sectors as well as banking, and maintains policies that provide preferential treatment of these firms. Industrial policies, mega state-owned enterprises, investment restrictions, and many other government controls have substantial influence on the trade with China.