Abstract

Notwithstanding the experiments with enterprise reforms undertaken since the early 1980s, deep structural problems remain in the SOE sector.79 It is increasingly recognized that these problems pose an obstacle to the attainment of a fully market-based economy, and that SOE reform is necessary to establish the microeconomic foundation that permits the effective functioning of the indirect instruments for macroeconomic management essential in a decentralized economy. Accordingly, resolving the problems of the SOE sector is one of the priorities of the current reform program. This section discusses the significance of the SOE sector, reviews past reforms, and describes the present approach to enterprise reform.

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