China leads in Fortune Global 500 list of firms

Growing fast: Chinas private sector is reshaping the global business landscape

The number of domestic companies on the world business league table exceeds those from the US for the first time since the rankings began in 1990

The latestFortune Global 500 listreveals that Chinese companies now outnumber their US counterparts and also demonstrates how Chinas private sector is reshaping the global business landscape, experts said.

Chinese companies accounted for 129 of the worlds 500 largest corporations by revenue, according to the list published on 22 July, exceeding the US, at 121, for the first time since the rankings began in 1990.

Chinawas also the top performer in terms of newcomers and companies with the largest leaps in rankings. Most Chinese enterprises on last years list had higher rankings this year.

Chinas performance indicates that the torrents of merger and acquisition activities aiming to forge globally influential conglomerates are starting to pay off, said Jiang Qingyun, a business professor at Fudan Universitys School of Management. Its a natural reflection of the countrys overall economic status.

Of the 25 companies that made their debut or re-entered the list, 13 were from China. They included state policy lender China Development Bank, the worlds largest rolling stock manufacturer CRRC, and mobile phone maker Xiaomi.

China led in the number ofmetal, construction, automotive and real estate companies. However, healthcare and medical companies in the US outnumbered Chinese counterparts on the list.

On the plus side, China is shaping up to have a number of major enterprises in select industries, Jiang said. Meanwhile, the temporary lack of consumer-sector businesses from China on the list indicates that the vast domestic market has yet to be fully tapped and there is plenty of room for growth.

Chinese technological powerhouses are making strides. Huawei moved up to 61 from 72 last year. Among the 10 companies registering the biggest jumps, six came from China, including tech titans Alibaba Group which was up 118 spots to 182, as well as Tencent, which moved up 94 places to 237.

The fostering of Chinese companies in the digital area, such as providing better financing channels like the Star Market, is bound to catapult them to the forefront of driving the next wave of economic growth, said Zhuo Fumin, chairman of Vstar Capital.

The 12th Global Innovation Index, soon to be published by researchers from Insead, Cornell University and the World Intellectual Property Organization, depicts Chinas continued progress as aglobal innovator.

Bruno Lanvin, executive director for global indices at Insead, said China broke into the top 20 of the index last year and the country continued to make progress in quality innovation where it remains a strong leader among middle-income countries.

The combined revenue of Chinese companies accounted for 25.6 per cent of the Fortune Global 500 lists total, behind the US at 28.8 per cent.

The average profit of the 119 Chinese companies, not including those based in Taiwan, on this years list stood at $3.5bn, lower than the lists average of $4.3bn. But it also improved from $3.1bn for the 111 Chinese companies on last years list.

That is a fact to be expected. Chinese companies are relatively smaller in profitability but they are growing at a much faster pace, Jiang said.

This article was originally produced and published by China Daily. View more articles

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