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China to Explore New Ways for Utilizing Foreign Funds

China will actively explore new ways for utilizing foreign funds as further regulating BOT, property rights transfer, issuance of stocks by enterprises, and a positive effort for purchasing and merger, venture capital and investment fund.

Zhang Xiaoqiang, vice secretary-general of the State Development Planning Commission (SDPC), made the remark at a press conference on major foreign-funded projects held in Yantai, June 10.

Zhang says that China encourages foreign investors, transnationals in particular, to participate in SOEs regrouping and transformation and stepping up opening of service sectors as banking, insurance, business, foreign trade and tourism.

China hopes that more funds would be injected into the central and western regions for local agriculture, restructuring of old industrial bases, infrastructure construction, ecological construction and environmental protection, mineral exploring and tourism, Zhang emphasizes. Western enterprises in certain industries are encouraged to attract foreign investment by means of transferring managerial right, selling stock options, merging and regrouping.

When talking about improving investment environment, Zhang said at the beginning of the year that the state has modified three laws to attract foreign investment, in which requirements on technique transfer, equipment localization, foreign exchange balance and import proportions were canceled. Regulations on foreign investment directions and industries are also under amendment to further lift market access restrictions in regions, numbers, business scales and proportions of share holding.

Zhang noted that since the reform and opening up China's mainland has attracted a total worth of over US$350 billion of foreign funds, including over 80 percent from APEC members.

(People's Daily 06/11/2001)

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