China's subsidies treat foreign and domestic firms equally: MOC

(ECNS) -- China's subsidies are equally applicable to all types of market entities without discrimination, allowing foreign-invested companies to participate and benefit on an equal basis, a commerce ministry official said on Tuesday.

Responding to claims that subsidies cause overcapacity, Han Yong, director general of the Department of WTO Affairs at the Ministry of Commerce, said many countries formulate targeted industrial policies based on their national conditions and needs. Subsidies are widely used worldwide to support emerging industries, agriculture and technological innovation.

Industrial subsidies are not inherently linked to overcapacity, Han noted. When well-designed, they can correct market failures, spur innovation, protect the environment, reduce poverty, and foster balanced growth - without creating surplus.

However, protectionist and discriminatory policies can disrupt global trade and investment, he said.

China strictly observes WTO rules and is improving the legality, transparency and effectiveness of its subsidy system. Chinese support mainly targets research and development, industrial technology, consumer demand, small and medium-sized enterprises, and green development. It also increasingly relies on public services, technical standards and skills training rather than direct market intervention, Han added.

(By Intern Lin Qiaochu, Zhang Dongfang)