The money-earning capability of China's top 500 enterprises has exceeded that of their United States counterparts for the first time, as the sweeping financial crisis pummeled many US firms while China is already entering an economic recovery.

Net profits for the Chinese companies stood at US$170.6 billion in 2008, well above the $98.9 billion for US companies in the same period, according to the latest report released on Saturday by the China Enterprise Confederation (CEC) and China Enterprise Directors Association.

Although the financial crisis decreased net profits for the Chinese heavyweights by 12.4 percent from a year ago, it is far less than the 84.6-percent fall experienced by US companies, which saw the worst decline in 55 years, as recorded by Fortune magazine.

Wang Jiming, vice-president of CEC, said although the numbers show Chinese companies were less vulnerable to the global financial crisis than their US counterparts, it did not mean they have made substantial improvements in overall competitive power.

"Chinese enterprises enjoy relatively better policies and domestic market environment," Wang said. "But Chinese companies still lag behind the world's leading enterprises in resource allocation, innovation, international presence, business models and corporate culture."

The Industrial and Commercial Bank of China, the country's biggest lender, was the top Chinese money-earner with a net profit of 111 billion yuan (US$16.4 billion) in 2008.

Half of the top 10 profit makers on the CEC list are financial companies, including banks and insurance companies.

"Compared with the US, where many IT companies have the strongest earning potential, the best money earners in China are still banks," said Xiong Xiaoge, vice-president of US venture capital IDG. "This means Chinese technology still has a lot of room to improve."

China Petrochemical Corp, Asia's leading refinery, topped the revenue list for the fourth consecutive year with 1.46 trillion yuan in 2008. Its net profit was 13.6 billion yuan.

According to CEC, the total revenue of China's top 500 enterprises amounted to 26 trillion yuan, an increase of 19.7 percent over last year.

On the international scene, an unprecedented 34 Chinese companies made it onto the list of the world's top 500 companies, overtaking Britain.

US companies captured 140 places in 2009, 13 less than last year.

This is the eighth consecutive year CEC has released its list.

Economy bottomed out

China's economy has already bottomed out and is in the crucial period of stabilization and recovery, Yao Jingyuan, chief economist with China's National Bureau of Statistics, said on Saturday.

Yao made the remarks at the ongoing 2009 International Forum on Chinese Automotive Industry Development in Tianjin, adding that the worst time for the economy was between November and February.

Despite signs of life, the Chinese economy still faces uncertainties, as growth in the world's third largest economy was boosted mainly by investment, not consumption, he added.

Official figures showed that investment contributed 6.2 percentage points to China's 7.1 percent year-on-year gross domestic product growth in the first half, and consumption added 3.8 percentage points. Exports, sliding for eight straight months, dragged down growth by 2.9 percentage points.

(China Daily, Xinhua September 7, 2009)