The ongoing economic downturn has triggered a worldwide wave of job slashing and salary cuts, and China is no exception.
China's Ministry of Finance recently unveiled a new policy imposing a salary cap on executives of state-owned financial institutions.
But some bank analysts hold that the move is likely to impair state-owned financial institutions' competitive edge, as their executives' moods will be affected, making them less motivated.
An article in Thursday's Beijing News, however, puts forth a different view.
The article says executive pay in state-owned enterprises is not supposed to be on a par with that of private enterprises, as state-owned enterprises are exclusively funded by the government and enjoy preferential policies. Some even operate as monopolies. Therefore, executives at state-owned enterprises experience less pressure than their counterparts in private enterprises.
The writer points out that a new Ministry of Finanace regulation dictates that the yearly salary for executives
