Question

What is the major source of financing for listed firms in China? Which firms (SOE vs. non-SOE) should have better access to financing? Why?

Answer 1

The chinese market is one of the major player in financial market. The fims in China can raise capital through several ways such as debt, equity, etc. These are the major sources globally as well. SOE (State owned enterprises) is the enterprises is created out of governement policy. Their management is in the hands of government. As it is state owned it has a better accss to the financial makrket to raise the funds. Whereas the non-SOE is not state owned and acts like private entity and as it is not supported by the government, it will be harder to raise he funds from the same market.