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China dismisses charges of unfair business climate

Japan asks China for 'appropriate decision' on yuan: media
Beijing (AFP) April 3, 2010 - Japan's finance minister on Saturday asked China to make an "appropriate decision" on its foreign exchange policy but stopped short of telling it what to do. Naoto Kan made the remarks at a news conference after meeting with Premier Wen Jiabao as part of weekend talks in Beijing with top officials. "I told Wen that I believe China's stable foreign exchange rate policy has helped ease the recent financial turmoil, and asked him to continue to make an appropriate decision" on the currency problem, Kan said, according to Dow Jones Newswires. But "I didn't say anything on what China should do or shouldn't do" about the yuan, he said. International disquiet has grown over the yuan, which critics say is undervalued by as much as 40 percent against the dollar, giving Chinese exporters an unfair advantage.

Washington has led the charge in ramping up the pressure on Beijing to let the yuan appreciate. It has been effectively pegged at about 6.8 to the US dollar since mid-2008. US lawmakers are pushing Treasury Secretary Timothy Geithner to label Beijing a "currency manipulator" in a report due April 15. Currently the yuan may rise or fall 0.5 percent against the dollar each day from a mid-point set by the China's central bank and three percent for non-dollar currencies such as the euro and Japanese yen. However Chinese media reports this week said the government is reviewing proposals to adjust its currency exchange rate system this month, including giving the yuan more flexibility.
by Staff Writers
Beijing (AFP) April 1, 2010
China rejected mounting foreign complaints about its business environment Thursday, saying it treats all investors equally and that any difficulties are due to increased competition in the huge market.

The comments by a government spokesman were the most detailed response yet to charges that China -- already accused of keeping its currency artificially low -- was tilting its playing field in favour of domestic companies.

"In short, the environment for investing in China is getting better," foreign ministry spokesman Qin Gang said.

An annual report to the US Congress on Wednesday said China had erected new hurdles to foreign competition with rules favouring domestic firms.

The report by US Trade Representative Ron Kirk cited a directive by China stipulating that sellers of high-tech goods must contain Chinese intellectual property for them to be included in a government procurement catalogue.

Accredited products will be favoured, according to the policy, which foreign firms say effectively excludes them from the process.

Last week, an American Chamber of Commerce in China survey found that 38 percent of members felt unwelcome to participate in China's market, up from 26 percent in the fourth quarter of 2009.

The survey cited discriminatory government policies and inconsistent legal treatment.

But Qin said China was "strictly fulfilling" its requirements under the rules of the World Trade Organization, which it joined in 2001.

He added that if businesses were encountering any problems, it was due to "fierce" competition in the market.

"We would like to say one thing to all businesses in China: Congratulations on getting rich," he said.

Critics accuse Beijing of keeping its yuan currency undervalued to maintain an unfair trade advantage while the politically sensitive massive US trade deficit with China remains a sore point between the two sides.

Concerns about doing business in China were highlighted by the case of four employees of Anglo-Australian mining giant Rio Tinto, including Australian national Stern Hu, accused of bribery and commercial espionage charges.

Hu was sentenced this week to 10 years in jail in Shanghai.

He and three Chinese colleagues were arrested last year amid contentious iron ore contract talks that later collapsed between top mining companies and the steel industry in China, the world's largest consumer of the raw material.

earlier related report
China's Sina says reassessing Google partnership
Beijing (AFP) April 1, 2010 - Popular Chinese web portal Sina said Thursday it was reassessing its cooperation with Google following the US Internet giant's decision to effectively shut down its China search engine.

A spokeswoman for Sina told AFP a state media report which said the company was "re-evaluating cooperation with Google" was accurate, but declined to give further details.

"No details have been finalised," a spokeswoman for Sina, who refused to be named, told AFP.

"Google actually owes all its business partners in China a response."

Google announced on March 22 that it was redirecting mainland Chinese users to an uncensored site in Hong Kong, making good on an earlier pledge not to go along with the Communist Party government's censorship rules.

Google's decision to defy Beijing was based on what it called concerns over censorship and cyberattacks it said originated from China.

Since then, several companies have dropped partnerships with Google after reportedly coming under political pressure to do so, highlighting the wider ramifications from its decision to scale back its China operations.

Tianya, for example, the operator of one of China's most popular Internet forums, has said it will halt work with the online giant on several projects.

TOM Group, which runs online and mobile Internet services in mainland China and is owned by Hong Kong's richest man Li Ka-shing, has also stopped users from visiting its website through Google's search engine service.

Earlier Thursday, the official Xinhua news agency quoted an unnamed Sina spokesperson as saying Google was not meeting the web portal's standards.

"All partners of Sina must abide by Chinese laws and regulations as well as have long-term plans to operate in China," the spokesperson was quoted as saying.

So far, Google has kept its 600-odd staff in mainland China and it is unclear what will happen to the employees.

Under Sina's partnership with Google, the US Internet firm's web page search service is embedded in the Chinese web portal's search box.

China is the world's largest online market by users, with at least 384 million people online and more than 750 million mobile subscribers -- many of whom access web content via their handsets.

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US cites China's 'troubling trend' of innovation barriers
Washington (AFP) March 31, 2010
The United States voiced concern Wednesday that China has erected new hurdles to foreign innovation, in an annual report to Congress on foreign trade barriers. "A troubling trend that has emerged... is China's willingness to encourage domestic or 'indigenous' innovation at the cost of foreign innovation and technologies," said the report submitted by US Trade Representative Ron Kirk. The ... read more

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