Beijing: Foreign companies say China is increasingly using discriminatory rules to reduce access to previously open areas of its economy and promote its technology industries, a US business group said yesterday, adding to rising complaints of worsening conditions for foreign investors.
The report by the American Chamber of Commerce in China comes as companies say Beijing is violating the spirit of market-opening commitments by trying to reserve segments of its economy for domestic companies in an effort to build up Chinese global competitors.
The chamber highlighted complaints about efforts to nurture China's computer and other technology companies — a policy dubbed "indigenous innovation" — by favouring them in government procurement and other areas.
Inconsistencies
American companies are "troubled by a mounting number of policy challenges ranging from the inconsistent enforcement of laws, to China's discriminatory domestic innovation policies and regulations that limit market access into sectors that had been increasingly open to foreign investment for the past 30 years," the group said in an annual report on business conditions.
The report said a survey of 388 companies found for the first time that inconsistent regulation has become the most significant challenge faced by American companies in China.
The report comes amid a series of incidents that have rattled foreign businesses, including Google's dispute with Beijing over censorship and the trial of four Rio Tinto employees on commercial spying charges.
