China to allow foreign ownership of small businesses
Foreign investors are to be allowed to buy out and control small and medium-sized Chinese businesses, according to a report carried today by state media.
Xu Ming, deputy director of SETC's Department of Foreign Economic Co-ordination, told an international investment meeting in the eastern port city of Xiamen that the move would inject a much-needed level of competitiveness into the Chinese market, the Xinhuaagency reported.
Mr Xu added that the government, which is currently thrashing out the details of the new legislation, would provide backing to foreign investors seeking to reform Chinese businesses, according to Xinhua.
He also pledged the introduction of new regulations to safeguard their interests. Official statistics show that foreign direct investment in China surged 21.7 per cent in the first seven months of 2001 from the same period last year.
The boom in investment in China, some of which has come at the expense of Southeast Asian countries, has been driven during the last year by anticipation of China's entry into the World Trade Organisation (WTO), as well as the Chinese economy's dynamic growth.