China's commitment to an outward-looking economy has provided enormous opportunities for domestic companies to "go outside," Assistant Minister He Xiaowei from the Ministry of Foreign Trade and Economic Cooperation said yesterday.

Meanwhile, the country's pending accession to the World Trade Organization means China will become more involved in economic globalization, He said.

By 2005, Chinese companies are expected to win as much as US$26.8 billion in new overseas engineering projects per year.

During the 10th Five-Year Plan period (2001-05), the combined value of overseas engineering projects could reach US$98.9 billion.

"To achieve this goal, Chinese companies will have to increase their capability because \international competition is increasingly fierce," the assistant minister said.

Domestic companies need to improve service, train more qualified personnel and arrange enough funds, he said.

Yang Zilin, president of the Export-Import Bank of China, said the main problem restricting Chinese companies' efforts to invest overseas is that the companies are short of funds.

More than 90 percent of foreign investment projects involving Chinese companies took investment of less than US$3 million, while the average investment by companies from developed countries was about US$4.5 million.

Meanwhile, a majority of foreign investment made by Chinese companies was in developing countries. "The investment risks were relatively high," Yang said.

The country should beef up policy support to these companies, he said.

As the country's key export-orientated policy bank, Exim bank will provide quality and highly efficient financial services for domestic companies investing in foreign countries, Yang said

"The bank will expand loan services to these companies which engage in processing trade or contract projects in foreign countries," he said.

The bank will also support Chinese companies' efforts to invest in projects or explore such prospects in countries to which the Chinese Government provides preferential loans, he said.

"Encouraging more domestic companies to go outward will play an important role in China's economic development and in the co-operation between China and foreign countries," he said.

The central government has already created a series of encouraging policies to support these companies in setting up subsidiaries overseas, Yang said.

China had set up about 6,000 investment companies in 160 countries and regions by the end of 1999, involving a total investment of US$7 billion.

Expansion of business will be beneficial to speeding up China's industrial mix adjustment, developing China's own multinational companies and fostering a new focus on exports.

(China Daily 03/14/2001)