TOKYO: Beijing is working on a merger of gigantic proportions.Two state-owned container shipping giants—China Ocean Shipping Co. (a.k.a. COSCO) and China Shipping Group—are working on a combination to create the world’s fourth-largest container-shipping line. The merger is part of the Communist Party’s plan to reform its bloated state-owned enterprises (SOEs) to better compete with international rivals.
While the two shipping giants have been hashing out a deal for months, a merger is still no guarantee. Social, political, and economic pitfalls inherent in an economy dominated by SOEs are hampering efforts to modernize and optimize the sector.
