Restructuring of publishing sector won't mean closures

By Qiu Bo (China Daily)
Updated: 2011-05-10 14:59
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Beijing - The number of newspapers and periodicals will not decrease as the industry consolidates, a senior official said on Monday.

Liu Binjie, director of the General Administration of Press and Publication, said, however, that the number of publishing houses would decrease as more government-owned publishing houses are turned into companies this year.

"The industry intends to merge the small houses into larger publishing groups," Liu told Beijing News.

The restructuring and consolidation will affect China's more than 6,000 non-political news publishing houses, which are all State-owned.

Those houses must pass a qualification test and apply for valid licenses from the State Administration for Industry and Commerce.

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Liu said that 60 to 70 percent of non-political newspapers and periodicals are running a deficit, while 50 to 60 percent of publishing houses are short of capital.

According to Shanghai-based First Financial Daily, the government has been suffering losses each year.

Another concern is that the employees will have to transfer their social welfare from the government, where it is fully covered, to other companies.

But Liu said the administration considers the workers' interests a priority and is demanding the houses guarantee their welfare.

"The industry is currently short-handed, so there shouldn't be worries of layoffs," said Liu, adding that some workers may be allocated to other posts.

He also added that the Ministry of Finance has issued preferential policies, such as tax reductions for publishing houses, to support the industry's reform.

Liu revealed that 1,300 non-political news publishing houses have already finished restructuring.

The industry's restructuring dates back to 2003, when the State Council called for a nationwide reform in the cultural industry.

Liu told China Daily in January that from 2005 to 2010, all of the 148 publication houses owned by central government departments had finished restructuring and become companies.

Huang Hua, a copyright expert with Beijing-based Wowa Media Company, pointed out that the General Administration of Press and Publication's move is essentially to activate and inspire China's cultural industry.

He believed it will bring more opportunities to the publishing industry, though a few of them may have to suffer a "painful experience".

"Newspapers can barely compete with websites if they don't become companies and attract sufficient funds," he said.