China ordered most companies owned by the central government to pay five percent more in dividends to the State from next year as the nation seeks to boost funding of social programs such as for healthcare and education, Bloomberg News reported Thursday.
Government companies in tobacco, petroleum and petrochemical, power, telecommunications and coal will pay the largest portion of their profits, or 15 percent, as dividends, compared with an earlier 10 percent, the report cited a notice posted on the Ministry of Finance's website as saying.
According to the report, the companies include China Petrochemical Corp, State Grid Corp of China, China Huaneng Group Corp and China Telecommunications Corp.
The higher dividend requirements come as China spends more on social services to reduce the burden of healthcare and education costs on families, thereby encouraging them to spend more on other goods, the report said.
Premier Wen Jiabao and other leaders have stressed the need to increase the role of domestic consumption in China's economy and to reduce the nation's reliance on exports and investment for growth, the report said.
