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SOEs exit property market slowly

11-12-2010 13:55 BJT

Earlier this year, property regulators in China told state-owned companies not primarily in the property sector, to stop all investments in the market. It was an effort to curb the nation's soaring property prices. Although some companies exited immediately, the process is taking a long time.

Currently, only four large companies have transferred their real estate businesses. Another seventy companies have not made much progress. According to the regulation, all designated SOEs should quit the market after finishing existing developments. Slow progress on this step may be the main factor behind the delay.

Zhu Zhongyi, VP of China Real Estate Assoc. said "It may take over a year for related companies to finish their projects. The property market has a cycle, so they cannot reform their businesses as quickly as we imagined."

The companies have had to face other complications... such as stock transfers and personnel changes. But experts say they have only make up a small amount of the market share, so their exit from real estate will not greatly impact the industry.

Zhu Zhongyi said "State-owned enterprises make up about 5 percent of the entire property market. And the companies that must withdraw from the real estate business only makes up one percent. Therefore, the policy will not impact the property market as a whole."

Editor:Xiong Qu |Source: CNTV.CN

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