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Foreign firms' monopolies cause concern
By Fu Jing (China Daily)
Updated: 2005-12-08 05:44
China should introduce an early warning-system to prevent multinational
companies (MNCs) from cornering the Chinese market, a cabinet think-tank has
suggested.
Xie Fuzhan, vice-president of the State Council Development Research Centre
urged the government to take action as foreign investors have intensified
expansion in some industrial sectors and obtained sizeable shares of certain
large projects.
"These are new trends in foreign investment, and they deserve close
attention," Xie warned.
"But it doesn't conflict with our lasting strategy that emphasizes
partnerships with MNCs which are willing to transfer core technologies and
management experience."
Facing the new investment trend, Xie suggested that China should establish
standards and a system to watch the behaviour of overseas investors to prevent
monopoly risks in the Chinese market.
The system and standards are expected to be line with the Anti-Monopoly Law,
which is going to be delivered to the National People's Congress for voting
soon.
Xie voiced his concerns at yesterday's forum on China's Investment
Opportunity and Overseas Chinese Entrepreneurs, which was organized by China
News Agency.
In addition to preventing foreign investors from implementing monopolistic
practices, China is establishing an anti-monopoly law to create equal market
access for all investors, said Lin Yueqin, researcher with Chinese Academy of
Social Sciences.
"The upcoming law will stipulate very clearly that a dominant market position
should not be allowed to be abused by any market players, either from home or
abroad," said Lin.
Lin said China will limit mergers and acquisitions and create a report system
in which any mergers or acquisitions that meet certain criteria will require
approval.
The criteria will be transparent, meaning enterprises will be held fully
responsible for their business activities, said Lin.
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