China State Companies’ Dominance Tested by Market Pledge

China’s state-owned companies, coddled by cheap credit and sheltered monopolies for years, face a less comfortable future after Communist Party leaders pledged to give market forces a bigger role in the economy.

The nation is likely to ease interest-rate and energy-price controls after the party this week assigned markets a “decisive” role in allocating resources, according to Wang Tao, chief China economist at UBS AG, who formerly worked at the International Monetary Fund. Other reform options include opening more industries to competition from private operators.