China Oil & Natural Gas Group Corporation and China Petrochemical Group Corporation Established.

China Oil & Natural Gas Group Corporation and China Petrochemical Group Corporation were established on July 27 in the Great Hall of the People in Beijing.

Wu Bangguo, Vice Premier of the State Council, attended the inaugural meeting of the two big group corporations and made an important speech. He pointed out that the regrouping of the two big group corporations is an important strategic decision of the State Council in the economic restructuring to speed up the reform of state-owned enterprises. The regrouping of the two big group corporations is of great significance. (1) Separation of government from enterprises can be achieved. Group corporations no longer have to perform government functions. They have become real economic entities, which will facilitate their participation in international competition. (2) Integration of upstream production with downstream production, production with marketing and domestic trade with foreign trade in petroleum and chemical industries can be achieved. (3) Structural readjustment can be accelerated to achieve the optimal distribution of resources and bring along the development of local economy. Wu Bangguo stressed that a fter the establishment of the two big group corporations measures should be taken to optimize resource distribution, avoid redundant construction and blind production, set up uniform and open market of oil and petrochemical products and enhance competitiveness of domestic oil and petrochemical products in the international market. Wu also requested the two big group corporations to revert the sliding economic performance of state enterprises, overcome difficulties and adopt effective measures to accomplish a profit of 10 billion yuan.

Wang Zhongyu, State Councilor and Secretary-General, read out the reply of the State Council to the issues related to the establishment of China Oil & Natural Gas Group Corporation and China Petrochemical Group Corporation. It is defined in the reply that China Oil & Natural Gas Group Corporation is mainly engaged in prospecting and development of oil and natural gas and also in production and operation of petrochemical products and has a registered capital of 114.9 billion yuan; China Petrochemical Group Corporation is mainly engaged in production and operation of petrochemical products and also in prospecting and development of oil and natural gas and has a registered capital of 104.9 billion yuan. The two big group corporations are entities with the investment right authorized by the state and also experiment units for state holding companies. The foreign trade right of crude oil and oil products is granted by the State Council to the two big group corporations.

Song Defu, Minister of the Personnel Ministry, read out the decision of the State Council on appointing leaders of the two big group corporations. Ma Fucai is appointed to be General Manager of China Oil & Natural Gas Group Corporation and Li Yizhong is appointed to be General Manager of China Petrochemical Group Corporation.

The inaugural meeting was presided by Sheng Huaren, Director of the State Economic & Trade Commission. Li Yongwu, Director of the State Administration of Petroleum and Chemical Industries, Ma Fucai, General Manager of China Oil & Natural Gas Group Corporation and Li Yizhong, General Manager of China Petrochemical Group Corporation made speeches at the meeting.

                 Market Exchange Rates Set by the People's
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