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Premier Li reassures Western investors

2014-09-10 08:17 China Daily Web Editor: Qin Dexing

Only 10 percent of the companies probed by Chinese antitrust authorities are foreign enterprises, Premier Li Keqiang said on Tuesday, dismissing speculation that recent anti-monopoly investigations target foreign companies.

Li made the remarks at a Q&A with foreign corporate leaders in Tianjin, reassuring them that China's door remains open wide to the world.

"I am concerned for the fact that you are concerned about the issue," Li said, answering a question from Klaus Schwab, executive chairman of the World Economic Forum, who asked if ongoing antitrust probes indicate an unfriendly attitude toward foreign investment from Chinese government.

The eighth World Economic Forum's Summer Davos Forum, which will be held in Tianjin this week, has attracted 1,600 government leaders and businesspeople from the world, a record high.

"China's door has opened, and it will never be closed again. I do hope that you will not worry for the future of China's opening-up," Li reassured the corporate leaders, most of whom are heads of foreign multinationals. "But, of course, the investment in China should follow the laws and business ethics."

The increase in antitrust probes is part of the results of improved administrative transparency, the premier explained.

"We improved the transparency of government supervision, which is meant to restore the fairness of the market," he said.

Li said these supervision efforts, including antitrust probes, are legal, transparent and fair. "It will benefit the opening-up and make more foreign investors come to China in the long run."

China's antitrust authorities have initiated rounds of probes since July. Most major global automakers have been investigated, and 12 Japanese auto suppliers were fined a total of 1.24 billion yuan ($201 million) by the National Development and Reform Commission for manipulating prices, the highest penalty since China's antitrust law took effect in 2008.

Intensive law enforcement against anti-monopoly practices has prompted the European Union and American chambers of commerce in China to voice their concern about the business environment for Western investors.

The European Union Chamber of Commerce in China said in August that although the antitrust law is "beneficial for developing a healthy market economy in China", it is concerned that domestic companies have not been targeted for similar violations, although their Western counterparts are under investigation.

In a report issued by the American Chamber of Commerce earlier last week, most of its members said they feel less welcome than before in China and almost half believe foreign companies are being targeted in the country's latest antitrust drive.

Klaus Kleinfeld, a participant at the meeting and chairman and CEO of Alcoa, a US metal manufacturing company, said he is impressed with the statistics provided by the premier that only 10 percent of the companies under antitrust investigation are foreign enterprises.

"Li has made it very clear that investment made by Western companies in China continues to be very welcomed, as he stressed reforms, a level playing field and that the rule is applied to everyone," he said.

Ann Lee, professor of economics at New York University, said that the premier "doesn't want to scare away foreign businessmen" because the country needs them to continue its economic growth.

"The antitrust and anti-graft campaigns are meant to make China a more appealing place to do business in the long run so that China will have a reputation like Germany's, Switzerland's, or Singapore's," she said.

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