Important English Vocabulary from “The Economist”-(Day-7):
Dear Readers, to score good marks in English Section first and for most thing is you need to develop your reading skills, while reading a passage you need to highlight the tough words in it and you should know the correct meaning for those words. This will help you understand the passage clearly and also you can learn more new words, it means also you can develop your vocabulary. To help you in this part we have provided a passage along with meaning, synonyms and usages of hard words in the passage, make use of it.
Reform of China’s ailing state-owned firms is emboldening them – Part-1
ACCORDING to company lore, Yunnan Baiyao, a musty-smelling medical powder, played a vital role during the Long March. As China’s Communist troops fled from attacks in the 1930s, trekking thousands of miles to a new base, they spread its yellow granules on their wounds to staunch bleeding. To this day, instructions on the Yunnan Baiyao bottle recommend application after being shot or stabbed. Many Chinese households keep some in stock to deal with more run-of-the-mill cuts. But the government has recently put its maker into service to treat a different kind of ailment: the financial weakness of state-owned enterprises (SOEs).
Yunnan Baiyao has emerged as a poster-child of China’s new round of SOE reform. The company, previously owned by the south-western province of Yunnan, sold a 50% stake to a private investor earlier this year. The same firm had tried to buy a slice of Yunnan Baiyao in 2009 but was blocked. Its success this time has been held up in the official press as proof that a push to overhaul sluggish state companies is at last gaining momentum under Xi Jinping, China’s president.
But for many investors and analysts, the Yunnan Baiyao case proves just the opposite: that SOE reforms are stuck in a rut. The sale, after all, left half the company in state hands. And a traditional Chinese medical powder is far removed from industries such as energy and finance, which the government deems strategic and is less willing to open to private capital.
It is hard to overstate the importance of getting SOE reforms right. In the 1980s, when China was starting to open to the world, the state sector dominated its economy, accounting for nearly four-fifths of output. A big factor behind China’s remarkable growth since then has been the relative decline of SOEs, to the point that they account for less than a fifth of output today. As state firms stood still, a vibrant private sector sprouted around them.
Over the past few years the state sector has, by several measures, stopped shrinking. There are still more than 150,000 SOEs in operation, two-thirds owned by local governments and the rest under central control. Private firms are much more productive, but state firms gobble up a disproportionate share of resources. They take about half of all bank loans and are the main culprits behind China’s big increase in corporate debt. Since 2015 investment by SOEs has grown faster than private-sector investment, reversing a decades-long trend (see chart 1).
For China this has the makings of a damaging cycle. As growth slows, the government leans on SOEs to spend more; but this drives up their debt further and so weighs on the economy. Putting a stop to this sequence is vital for China if it is to become wealthy. The IMF estimates that an ambitious programme of SOE reform could expand the Chinese economy by nearly 10%, or about $1trn, over the next decade.
The fate of China’s state firms is also a global concern. By international standards, they are already massive. China’s 200 biggest SOEs account for 9% of global revenues in coal mining, 6% in car making and 5% in construction. A series of mega-mergers currently under way is concentrating even more power in the hands of a few, giving them the heft to barge into new markets. For foreign firms this can smack of unfair competition, as if they are fighting against the Chinese state. The temptation for other countries to block foreign investments by SOEs will only increase, setting the stage for bitter disputes.
Market failure
Back in 2013 Mr Xi seemed to grasp that change was needed. He vowed that market forces would play a “decisive role” in allocating resources and declared that reform of SOEs was a priority. Although a big-bang privatisation was never on the cards, the hope was that the government would make SOEs better run, more competitive and less coddled. There has been a bewildering array of directives and pilot programmes since then but little real progress. The fear is that the reforms, taken together, not only fail to solve the most pressing problems, but might even be aggravating them. SOEs are getting bigger, not smaller; their management has become more conservative; and their deficiencies are beginning to infect the economy more widely.
Keeping track of all the different experiments that fall under the heading of “SOE reform” is a full-time job. When Mr Xi put it on the agenda in 2013, the government broke it down into 34 separate initiatives, farmed out to different departments and agencies. It has since published at least 36 supplementary documents and launched reform trials at 21 different firms. Provinces and cities have followed up with dozens of plans, guidelines and trials of their own.
Some promising ideas are afoot. After years of discussion, China has started to let state firms award shares to employees as part of their pay packages. SOEs had tried such schemes in the 1980s and 1990s, but the government stopped them, fearing that senior executives were siphoning off state assets, much like Russia’s oligarchs.
Shanghai International Port Group (SIPG), a city-owned firm, is one of the companies pioneering employee ownership of shares. It also demonstrates how local SOEs, though smaller than their national peers, are often huge themselves: SIPG is the principal operator of Shanghai’s cargo port, the world’s busiest. In June 2015, as a first step, it allocated 1.8% of company shares to employees; some 16,000 of its 22,000 employees now hold a stake. Ding Xiangming, vice-president of the port group, believes he is already seeing results. “Workers are more focused on our company’s growth,” he says.
Source: The Economist
1). Lore (Noun)
Definition: a body of traditions and knowledge on a subject or held by a particular group, typically passed from person to person by word of mouth.
Synonyms: mythology, myths, legends, stories, traditions
Usage: He had a passion for Arthurian legend and lore.
2). Staunch (Adj)
Definition: (of a wall) of strong or firm construction
Usage: These staunch walls could withstand attack by cannon.
3). Stab (Verb)
Definition: thrust a knife or other pointed weapon into (someone) so as to wound or kill.
Synonyms: knife, run through, skewer, spear
Usage: He stabbed her in the stomach.
4). Ailment (Noun)
Definition: an illness, typically a minor one.
Synonyms: illness, disease, disorder, sickness
Usage: The doctor diagnosed a common stomach ailment.
5). Overhaul (Verb)
Definition: take apart (a piece of machinery or equipment) in order to examine it and repair it if necessary.
Synonyms: service, maintain, repair, mend, fix up, patch up
Usage: The steering box was recently overhauled.
6). Sluggish (Adj)
Definition: slow-moving or inactive.
Synonyms: inactive, quite, slow, depressed
Usage: The sluggish global economy.
7). Rut (Noun)
Definition: a long deep track made by the repeated passage of the wheels of vehicles.
Synonyms: wheel track, groove, track, trough
Usage: The Land Rover bumped across the ruts.
8). Deem (Verb)
Definition: regard or consider in a specified way.
Synonyms: regard as, consider, judge, adjudge, hold to be
Usage: Many of these campaigns have been deemed successful.
9). Sprout (Verb)
Definition: grow (plant shoots or hair).
Synonyms: grow, develop; send forth, put forth
Usage: Many black cats sprout a few white hairs.
10). Gobble up (Verb)
Definition: use a large amount of (something) very quickly.
Usage: These old houses just gobble up money.
11). Lean (Verb)
Definition: be in or move into a sloping position.
Synonyms: slant, incline, bend, tilt, be at an angle
Usage: A line of palm trees leaning in the wind.
12). Heft (Verb)
Definition: lift or carry (something heavy).
Synonyms: lift, lift up, raise, raise up, heave, hoist
Usage: He lifted crates and hefted boxes.
13). Barge (Verb)
Definition: move forcefully or roughly.
Synonyms: push, shove, force, elbow, shoulder
Usage: He barged his way to the front of the queue.
14). Grasp (Verb)
Definition: seize and hold firmly.
Synonyms: grip, clutch, clasp, hold, clench, lay hold of
Usage: She grasped his hands.
15). Vow (Verb)
Definition: solemnly promise to do a specified thing.
Synonyms: swear, swear/state under oath, swear on the Bible, take an oath, pledge
Usage: The rebels vowed to continue fighting.
16). Coddle (Verb)
Definition: treat (someone) in an indulgent or overprotective way.
Synonyms: wait on someone hand and foot, cater to someone’s every whim; spoil, indulge
Usage: Don’t coddle repeat offenders—some of them prefer jail.
17). Bewildering (Adj)
Definition: confusing or perplexing.
Usage: There is a bewildering array of holidays to choose from.
18). Aggravate (Verb)
Definition: make (a problem, injury, or offence) worse or more serious.
Usage: Military action would only aggravate the situation.
19). Conservative (Adj)
Definition: averse to change or innovation and holding traditional values.
Synonyms: traditional, stable, unchanging
Usage: They were held in check by the conservative trade-union movement.
20). Afoot (Adverb & Adj)
Definition: in preparation or progress; happening or beginning to happen
Synonyms: going on, happening, around, about, abroad, circulating
Usage: Plans are afoot for a festival.
21). Oligarch (Noun)
Definition: a ruler in an oligarchy, (especially in Russia) a very rich business leader with a great deal of political influence.
22). Peer (Verb)
Definition: look with difficulty or concentration at someone or something.
Synonyms: squint, look closely/earnestly, try to see, look through narrowed eyes
Usage: He swivelled his head to peer in our direction.
Phrase in the Passage:
Siphon off – draw off or convey (liquid) by means of a siphon.
Siphon is a tube used to convey liquid upwards from a reservoir and then down to a lower level of its own accord. Once the liquid has been forced into the tube, typically by suction or immersion, flow continues unaided.
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