China repeals controversial technology trade rule

Jun 30, 2011 By JOE McDONALD , AP Business Writer

(AP) -- China has repealed a policy favoring Chinese producers in government purchases of computers and other technology that triggered complaints by foreign companies and governments that it violated free trade.

The Finance Ministry announcement was the second time in a month that Beijing repealed a policy after complaints by its trading partners. The U.S. announced June 7 that China was withdrawing measures that American officials said improperly subsidized Chinese wind turbine makers.

A brief ministry statement late Wednesday said it would no longer enforce procurement rules that are part of a decade-old "indigenous innovation" campaign to spur domestic technology development. They required government agencies to favor Chinese makers in six areas including computers, clean power and communications.

"This repeal represents a forward step toward leveling the playing field in the government procurement market in China," said Davide Cucino, president of the European Union Chamber of Commerce in China, in a written response to questions.

Foreign businesses had complained the rules would hamper or eliminate access to fast-growing technology markets in China, where the government often is the leading purchaser of computers and other advanced equipment.

agreed to repeal policies linking innovation to government purchasing during President Hu Jintao's visit to Washington in January.

The regulations were a core element in complaints by foreign companies that Beijing is trying to reserve China's most promising industries for domestic competitors in violation of its free-trading pledges.

The repeal is a "meaningful step by the Chinese government in delinking government procurement from indigenous innovation," said Ted Dean, chairman of the American Chamber of Commerce in China, in a written statement.

Dean said the group would watch to see whether the latest change was carried out at the local level.

The rules were especially sensitive at a time when the United States and other Western nations hope to revive economic growth by boosting technology exports.

Beijing has launched "Buy " campaigns previously to favor local suppliers in construction and other projects. But the technology procurement rules were unusually explicit in rejecting a foreign role on such a large scale.

Explore further: Netflix branches into films with 'Crouching Tiger' sequel

2 /5 (1 vote)
add to favorites email to friend print save as pdf

Related Stories

China eases home grown tech purchase rule

Apr 13, 2010

(AP) -- China has eased requirements for companies to qualify for government purchasing of technology after a plan to favor domestic technology was met with heavy criticism from other countries and business groups.

US, Europe press China to drop tech security rule

Apr 28, 2010

(AP) -- Global technology suppliers face a looming Chinese deadline to reveal the inner workings of computer encryption and other security products in a move the United States and Europe say is protectionist.

China to step up controversial technology plans

Jan 27, 2011

(AP) -- China plans to step up efforts to develop clean energy and other technology industries this year, government officials said Thursday, a strategy that has strained trade ties with Washington and other governments.

US, Europe look to China for clean energy sales

May 17, 2010

(AP) -- U.S. leaders want China's clean energy boom to drive technology exports and are sending a sales mission to Beijing this week. But Beijing wants to create its own suppliers of wind, solar and other equipment and is ...

Recommended for you

The New York Times to cut 100 newsroom jobs

12 hours ago

The New York Times Co. says it is cutting about 100 newsroom jobs through buyouts and layoffs in an effort to trim costs and focus more on its digital efforts.

What's PayPal's first solo move?

Sep 30, 2014

PayPal's impending split from long-time partner eBay Inc. will ratchet up its appeal to online retail competitors such as Amazon.com and give it the freedom to aggressively take on new mobile pay challeng ...

AOL to feed more video, news to Microsoft's MSN

Sep 30, 2014

AOL will provide Microsoft's MSN with more video and additional news stories from popular sites such as The Huffington Post and TechCrunch in an expansion of a deal aimed at selling more digital advertising.

User comments : 0