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BEIJING - The country's top 500 giants are narrowing gap with foreign counterparts, but they still lag behind, the China Enterprise Confederation announced in its release of the 2008 Top 500 Chinese enterprises list on Saturday.

According to the report, the total revenue of the top 500 Chinese enterprises reached US$2.99 trillion (1 dollar= 7.3046 yuan, calculated under the exchange rate in 2007), profits US$188.4 billion and assets US$8.17 trillion.

Revenues were equivalent to 12.67 percent of the global top 500, profits equaled 11.85 percent and assets 7.79 percent, compared with 10.7 percent, 6.5 percent and 7.8 percent respectively last year.

Analysts said the growing proportion of revenue and profits indicated that Chinese companies had become more competitive and profitable.

Confederation deputy president Li Jianming said the country's growing economy had benefited these enterprises in spite of price hikes for oil and other materials.

He also said private enterprises had grown more robust and capable of taking in advanced technology and management from world giants. They accounted for about a fifth of the country's top 500 enterprises.

In addition, their rising investment in research and development and their emphasis on exploring the domestic market increased competition. The growth rate of net profits of the country's top 500 was 19 times faster than that of the world's top 500.

However, another confederation deputy president Wang Jiming said Chinese enterprises still fell behind in innovation, investment in research and development, and the ability to operate internationally. It would take a long time to catch up.

Only 39 enterprises reported overseas sales income of more than 30 percent of the total revenue. Research and development spending accounted for only 1.32 percent of their total revenue, compared with the international average of 3 percent to 5 percent.