State-owned enterprises (SOEs) are legal entities that undertake commercial activities on behalf of an owner, which is the government of the country where the firm is based and operates. In China, they contribute 60 per cent of gross domestic product, 80 per cent of urban employment and provide 90 per cent of new jobs. Critics say SOEs distort markets and do not allow for a level playing field for overseas companies. Beijing’s subsidies for its SOEs have been one of the major roadblocks to progress in negotiations in the US-China trade war.