"To develop enterprises able to compete with their international peers, the country should spare no efforts to promote innovation, encourage enterprises to expand internationally and develop modern logistics," Liao Xiaoqi told the Top 500 Forum held on Saturday in Zhenzhou, central China's Henan province.

Eighty-four enterprises with profits of over one billion yuan (125 million US dollars) accounted for 85 percent of the Top 500profits.

The average profit growth rate of the Top 500 was 20.14 percent with trade and wholesale, retail, aviation and enginery sectors over 100 percent, but just 474 enterprises were in profit and 21 were in the red.

The report revealed that 349 enterprises in the list were state owned, accounting for nearly 70 percent of the total. Their combined assets reached 39 trillion yuan (4.87 trillion US dollars) at the end of 2005, accounting for 95 percent of the total.

It showed that state-owned economy remained dominant and controls the leading industries in the national economy.

The number of private owned enterprises in the list rose slightly by 1.6 percent year on year to 87 with total assets of 712.7 billion yuan(89 billion US dollars).

Critics said many of the Top 500 are monopoly enterprises unfairly gained competitive advantages and had no real ability to hold their leading positions.

Yang Du, professor with the Renmin University, on the other hand, held the view that monopoly behavior, rather than monopoly enterprises, was supposed to have an adverse impact on the market. In fact, the monopoly position of an enterprise would help it run smoothly and, to a certain degree in an industry, would enhance the efficient utility of resources.

Yang said the production concentration in China was far lower than the United States where there were mega businesses in every industry.

The CEC said the list had 19 enterprises making their way into the World Top 500 while there were 11 in 2002.

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