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Chinese President Xi Jinping has called on the state-owned enterprises (SOEs) directly administered by the central government to better serve the overall work of the Party and the country and contribute more to Chinese modernization.

Xi, also general secretary of the Communist Party of China (CPC) Central Committee and chairman of the Central Military Commission, made the remarks in an instruction conveyed by Premier Li Qiang at a meeting of heads of central SOEs held in Beijing on Monday and Tuesday, according to the Xinhua News Agency.

While affirming their pivotal role in the economy, Xi said central SOEs should serve high-quality economic and social development and the improvement of people's livelihoods, further deepen reform, and effectively prevent and defuse risks, Xinhua reported.

Central SOEs should enhance their core competitiveness and work to build world-class enterprises, Xi said, calling on them to stay rooted in the real economy and strive to achieve breakthroughs in key and core technologies, according to Xinhua.

He also underscored the importance of upholding and strengthening the Party's overall leadership over central SOEs, improving institutional frameworks, tightening supervision, and resolutely combating corruption, Xinhua said.

Backbone of national economy

"At the central SOE leaders' meeting, the President's important instructions provide fundamental guidance for advancing reform of central SOEs," Ni Zhen, Chairman of China Energy Engineering Corp (Energy China), who attended the meeting, told the Global Times on Tuesday.

Ni said that central SOEs are the backbone of China's national economy. Since the start of the 14th Five-Year Plan period (2021-25), Energy China has deeply implemented the President's instructions on SOE reform and development, bearing national priorities in mind, and fulfilling new missions with strong responsibility. 

In terms of their economic contribution to the national economy, the total assets of central SOEs exceeded 90 trillion yuan ($12.8 trillion) in 2024, representing a year-on-year increase of 5.9 percent. They achieved an added value of 10.6 trillion yuan, a profit of 2.6 trillion yuan, and contributed 2.6 trillion yuan in taxes, according to statistics from the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council.

More than just economic growth, during the 14th Five-Year Plan period (2021-25), central SOEs handled approximately 80 percent of the crude oil supply, 70 percent of the natural gas supply, and 60 percent of the electricity supply, effectively ensuring energy security, according to SASAC.

"Amid accelerating global supply chain reconfiguration, central SOEs play an irreplaceable role in securing supply chains for energy, food, strategic minerals and core equipment in China," Hu Qimu, a deputy secretary-general of Forum 50 for Digital-Real Economies Integration, told the Global Times on Tuesday.

Meanwhile, central SOEs also shoulder the responsibility of achieving breakthroughs in key technologies and "bottleneck" industries to ensure the overall security of industrial and supply chains, Hu noted.

Zhang Yuzhuo, chairman of SASAC, said in a recent interview with Xinhua that central SOEs are the core of the nation's scientific and technological innovation and an important component of the country's strategic scientific and technological forces. 

"In recent years, central SOEs have treated sci-tech innovation as their top priority. R&D investment has exceeded 1 trillion yuan for three consecutive years," Zhang said. 

"Breakthroughs were made in core technologies such as machine tools, industrial software and basic materials, and flagship projects such as the Chang'e-6 lunar mission and the Fendouzhe (Striver) deep-sea submersible were developed," he said in the interview with Xinhua.

SASAC data showed that in 2024, R&D funding investment by central SOEs reached 1.1 trillion yuan, exceeding 1 trillion yuan for three consecutive years. Investment in strategic emerging industries totaled 2.7 trillion yuan, representing a year-on-year increase of 21.8 percent.

Since the start of the 14th Five-Year Plan, cumulative investment by central SOEs in strategic emerging industries reached 8.6 trillion yuan, with the average annual growth rate exceeding 20 percent. A number of world-class industrial clusters have been established in areas such as new-generation information technology, new energy, new materials and high-end equipment, according to SASAC.

Analysts also pointed to the role of central SOEs in integrating industrial chains and providing application scenarios for new technologies, including those innovated by private companies.

The driving role of central SOEs has grown increasingly strong. In recent years, they have made annual purchases exceeding 15 trillion yuan, directly supporting approximately 2 million large, medium, small and micro-sized enterprises across upstream and downstream industrial chains, while indirectly benefiting nearly seven million related enterprises, according to SASAC.

SASAC said that in 2024, it released over 4,600 supply-demand matching lists to society, promoting mutually beneficial cooperation and integrated development among enterprises of all ownership types.

"Central SOEs can help new technologies, especially those from the private sector, find their application scenarios, enabling innovations to be quickly commercialized and industrialized, and forming an industrial system and ecosystem. This way, the new technologies can actually empower the real economy," Hu said. 

In terms of finance, Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times on Tuesday that some central SOEs have actively implemented share repurchase and increase holdings plans, and these measures "are conducive to stabilizing market expectations."

Future plan

During the 15th Five-Year Plan period (2026-30), central SOEs must provide strong support for advancing major infrastructure projects, and accelerate the upgrading of traditional infrastructure with digital and intelligent technologies, said Premier Li, who attended the meeting of heads of central SOEs and delivered a speech.

Li urged central SOEs to develop emerging and future industries in line with their core functions and businesses, while ensuring stable energy and resource supplies. Li called on them to strengthen applied basic research and play an active role in serving major national strategies.

Li also emphasized the need to further deepen reforms of state capital and SOEs, adding that heads of central SOEs should fulfill their duties with a more proactive and enterprising spirit.

The future plan for SOEs was also included in the Recommendations of the CPC Central Committee for Formulating the 15th Five-Year Plan for National Economic and Social Development, which was adopted at the fourth plenary session of the 20th CPC Central Committee on October 23.

"We must uphold and fulfill our commitments to both the public and nonpublic sectors and see that economic entities under diverse forms of ownership complement each other and develop side by side. Reform of state capital and SOEs should be deepened. To help state capital and SOEs get stronger, perform better, and grow bigger, we should refine the layout of the state-owned sector, adjust its structure, and enhance the core functions and competitiveness of SOEs," read the recommendations.

Ni of Energy China said that this year, the company has systematically made plans for development during the 15th Five-Year Plan, proposing to solidify high-quality development through eight foundations: Party building, lean management, green and intelligent growth, core business focus, innovation-driven operations, reform-enhanced governance, brand-led culture and talent capabilities.

"This approach aligns closely with the President's directives, serving as our greatest certainty and confidence in navigating future external uncertainties," Ni noted.

In 2026, at the start of the 15th Five-Year Plan period, facing intensified global chain restructuring, fierce tech competition and mounting climate transition pressures, central SOEs face higher expectations. They are expected to serve as the "ballast stone" stabilizing the high-quality economic growth amid turbulence, while acting as the "vanguard boat" pioneering breakthroughs in uncharted waters, Hu said.