Huawei ranked top private enterprise for fourth straight year by China’s leading state-backed business association, followed by HNA Group

Xie Yu

Huawei Investment and Holding was crowned as the champion of China’s top 500 private enterprises on Thursday, winning the title for the fourth consecutive year in the ranking of domestic private companies by a quasi-governmental group.

Indebted Chinese conglomerate HNA Group was picked as the runner up. Suning Holdings Group, a home appliance retailing conglomerate, took third place.

Chinese internet giant Alibaba and Tencent did not join the competition, according to a report issued by the authority, which did not elaborate on the reasons. (Alibaba is the owner of the South China Morning Post.)

The top 500 list is an annual ranking conducted by the All-China Federation of Industry and Commerce (ACFIC), which is something akin to the Chamber of Commerce in the US and was founded in 1953. It acts as “a bridge for the party and the government to connect with the non-public economy”, its official website said.

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Gao Yunlong, chairman of the ACFIC, also acts as vice-chairman of China’s top political advisory body, called the Chinese People’s Political Consultative Conference.

“The ranking of enterprises in China always carries some signal that is beyond making just economic sense,” said Xiao Lei, a Beijing based financial columnist with news portal Sina.

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There are many different standards that could be applied to rank companies, he said, and one could be to praise or support certain companies, he said.

“Huawei is definitely a role model that inspires the Chinese people during the trade war with the US. HNA, although struggling in a debt crisis, is considered a nationalist brand, and has been receiving official support,” he said.

Domestic sales for Huawei surged after the firm was sanctioned by the US. That helped the company offset the ongoing issues in the US. Second-quarter China smartphone shipments for Huawei surged by a nearly a third from the same period a year earlier.

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On the day the company introduced its self-developed Harmony operating system, August 9, the official Global Times said it represented a “strategic breakout” by a Chinese tech firm that will lead the country to break US domination in the tech sector.

HNA, an aviation conglomerate, has been defaulting on onshore bonds after sinking in a debt trap. It received about 1 billion yuan from the Hainan government last week, and repaid a US$300 million offshore bond this Monday, Bloomberg reported.

The top 500 ranking is based on the revenue income of companies in 2018, according to the report issued by the ACFIC. Huawei reported the highest number at 721.2 billion yuan, while HNA Group came in second with 618.3 billion yuan, and Suning third with 602.4 billion yuan.

As a comparison, in the recently released Fortune Global 500 list, insurance conglomerate Ping An was the highest ranking Chinese private firm at No. 29, followed by Huawei at No. 61, and JD.com at No. 139. Alibaba ranked No. 182, and Tencent No. 237. Ping An did not apply to be in the ACFIC ranking.

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