This presentation outlines the key findings from a publication on "State-Owned Enterprises as Global Competitors" published on 8 December 2016. An estimated 22% of the world’s largest firms are now effectively under state control. The upsurge of state-owned enterprises (SOEs) as global competitors has given rise to concerns related to a level playing field. Some business competitors and observers claim that preferential treatment granted by governments to SOEs in return for public policy obligations carried out at home can give SOEs a competitive edge in their foreign expansion. The OECD has taken a multidisciplinary approach, looking at the issue from the competition, investment, corporate governance and trade policy perspectives. Find the publication and more online at http://www.oecd.org/corporate/state-owned-enterprises-as-global-competitors-9789264262096-en.htm

1. STATE-OWNED
ENTERPRISES AS
GLOBAL COMPETITORS
A Challenge or an Opportunity?
KEY FINDINGS – December 2016

2. • 22% of the world’s largest 100 firms are state
controlled companies – this is the highest
percentage in decades
• SOEs operate in sectors important to
international supply chains, such as public
utilities, manufacturing, metals and mining,
and petroleum
• There has been a surge of SOE-led
international M&A activity observed over the
last 10 years
• These trends are likely to continue in the
foreseeable future
SOEs are going global – A few facts

3. Sectorial breakdown of world's
largest SOEs
Source: Forbes Global-2000. As of end-2014.

4. SOEs as targets and acquirers of IM&A
by deal value (USD million), 1996 - 2015
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
100000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015*
SOE acquirors from mature economies SOE acquirors from mature economies of which from EU
SOE acquirors from emerging economies SOE acquirors from emerging economies of which from China
Source: Author calculations based on Dealogics IM&A data, 2015.

5. • SOEs may not always operate on a level
playing field
• Compensation and special advantages
granted by governments in return for
public policy obligations at home can have
harmful spillovers
• Asymmetric contestability in home
markets for foreign competitors
SOE as Global Competitors – Some
Perceived Concerns

6. • Address distortions that may arise from state
intervention at the domestic level.
• Promote high standards of governance,
disclosure, accountability and transparency
for SOEs.
• Recipient countries investment policies
should be non-discriminatory and
transparent towards SOEs.
• Identify and remedy gaps in the coverage of
multilateral rules regarding trade distorting
government and enterprise behaviour.
Policy Options

7. OECD (2016), State-Owned Enterprises as
Global Competitors: A Challenge or an
Opportunity?, OECD Publishing, Paris.
www.oecd.org/corporate/state-owned-
enterprises-as-global-competitors-
9789264262096-en.htm
Accessible Online – as of 8 December 2016