The Strategist

China Railway Corporation finishes restructuring, changes name

06/19/2019 - 12:27

China Railway Corporation, with the approval of the State Council of China, completed restructuring and changed its name to China State Railway Group Co. Ltd. This is expected to make the company more market-oriented, reports China Daily.

The company with a registered capital of almost 1.74 trillion yuan ($ 252 billion) is subordinate to the central government. The Ministry of Finance performs the duties of an investor on behalf of the State Council.

The company is an authorized legal entity and is allowed to create subsidiaries, branches and representative offices in accordance with needs of business development.

Efforts to restructure and change the name were undertaken after conducting a series of institutional reforms since 2017 to improve corporate governance of the country's railway network.

Established in 2013 after dissolution of the Ministry of Railways, China Railway Corporation was at the forefront of corporate reform in the country aimed at developing modern railway enterprises and separating government functions from business.

Creating China State Railway Group Co. Ltd. is expected to contribute to a more efficient use of capital, competitiveness in the market and capacity of the local railway industry to prevent risks.

It is also expected that state-owned railway companies will become more market-oriented, and the quality of freight and passenger services will increase.