The Chinese central government has ordered all units of the Communist party and the bureaucracy to break their links with state enterprises from January.

Large firms will be handed over to a new committee controlled by the cabinet and small businesses will be supervised at regional level.

Similar moves have recently been imposed on the military, police and judiciary in an attempt to curb corruption and boost competition.

The China Daily said the changes had become more urgent because of state enterprise losses of nearly forty-billion dollars in the first half of the year.

The BBC Beijing correspondent says offical anxiety that local officials have been selling off state firms at bargain prices to their cronies may also be a factor.