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Balance tilts in favor of local firms

[ 2009-06-16 14:26]     字號 [] [] []  
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When the going gets tough, the tough, sometimes, complain - it's about where the precious money goes, and who gets the few life-saving deals.

And sometimes, their complaints are heard and acted upon.

For the first time since the launch of the nation's 4-trillion-yuan economic stimulus package late last year, the government has responded favorably to rising protests about too many fat contracts being awarded to foreign companies.

On June 1, the National Development and Reform Commission (NDRC), the top economic planner, warned in a statement that Chinese products have suffered "illegal barriers" when bidding for government purchases paid for from the stimulus budget.

It said the "discrimination" is particularly serious in industries including equipment manufacturing, which has "aroused wide concerns from industry associations and companies".

On June 4, the NDRC and eight other ministries jointly released a notice requiring local governments to give priority to Chinese products when purchasing for government-invested projects.

Lu Renqi, vice-president of the China Machinery Industry Federation, said many local governments favor imported products because of strong financial incentives.

Many machinery items fall under the Customs' "encouraged" category for import, and thus enjoy preferential tariffs. The appreciation of the yuan has played a part in the reluctance to buy local.

There are no figures on the proportion, or the value, of foreign products purchased under the stimulus budget.

But some major projects have been won by foreign companies, such as German industrial conglomerate Siemens AG's winning of a 750-million-euro ($1 billion) order for Beijing-Shanghai high-speed rail trains.

"The mentality that foreign brands are better than Chinese ones has misled us for years," said Jing Yunchuan, chief lawyer of Beijing-based Gaotong Law Firm, criticizing Chinese companies which prefer foreign products.

After three decades of progress, many Chinese brands have built up core competitiveness, but some purchasers do not seem to be aware, said Jing.

But even as local firms seem to be receiving some redress, foreign companies are complaining that they are the victims of unfair bidding practices.

Joerg Wuttke, president of the European Chamber, was quoted as saying by China Economic Weekly that "the Chinese government seems to have readily wiped foreign providers out of the country's 4-trillion-yuan stimulus package".

Last month, all foreign companies had lost in the first round for a 5-billion-euro project for 25 sets of wind turbine generators, including the world's leading producers GE International Inc and Vestas Wind Systems A/S.

"In the stimulus package, there is no clause or rule to limit foreign suppliers. Chinese and foreign companies have an equal right to compete," said Ma Haitao, a professor at the Central University of Finance and Economics.

Questions:

1. On which day did the National Development and Reform Commission (NDRC) released a notice requiring local governments to give priority to Chinese products when purchasing for government-invested projects?

2. Which firm won the 750-million-euro ($1 billion) order for Beijing-Shanghai high-speed rail trains?

3. What was the president of the European Chamber complaining about recently?

Answers:

1. June 4.

2. German industrial conglomerate Siemens AG's.

3. That foreign companies had lost in the first round bid for a 5-billion-euro project for 25 sets of wind turbine generators.

(英語點津 Helen 編輯)

Balance tilts in favor of local firms

Balance tilts in favor of local firmsBrendan joined The China Daily in 2007 as a language polisher in the Language Tips Department, where he writes a regular column for Chinese English Language learners, reads audio news for listeners and anchors the weekly video news in addition to assisting with on location stories. Elsewhere he writes Op’Ed pieces with a China focus that feature in the Daily’s Website opinion section.

He received his B.A. and Post Grad Dip from Curtin University in 1997 and his Masters in Community Development and Management from Charles Darwin University in 2003. He has taught in Japan, England, Australia and most recently China. His articles have featured in the Bangkok Post, The Taipei Times, The Asia News Network and in-flight magazines.

 
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