China amends laws on foreign investments in China
It is expected that the revised law submitted to the top legislature should facilitate China's impending accession to WTO. Apparently, it will ease existing restrictions on China-foreign cooperative ventures and solely foreign funded ventures in terms of foreign exchange balance, priority of purchasing in China and selling products to overseas markets. Also, Chinese-foreign funded ventures and solely foreign-funded ventures would no longer have to report their production and execution plan to government departments. (Xinhua, 23 October)

China to open public utilities to private firms
The government will gradually relax limitations on private businesses entering the public utility market. The move is seen as necessary to meet booming demand in the sector. China's ability to supply water and gas is still modest, and shortages in these essentials are common. Thus, some sectors, specifically water supply and drainage, sewage treatment, heating supply and large-scale public transport services shall auction special licenses. Private licensees would then be encouraged to conduct transregional operations or unified urban and rural businesses, all made more efficient by competition. (Jingji Ribao Economic Daily, 23 October)

China-EU summit in Beijing: WTO
China reassured foreign investors during the opening of a Sino-European Union summit in Beijing that it would honor all its obligations as a World Trade Organization member. The EU plans to raise six awkward WTO issues which have arisen during the Geneva talks and which are likely to delay China's membership of the global trade body. In particular the EU is upset China has failed to give European insurers five new licenses to operate in the country within 60 days of the Sino-EU trade deal in May, as the EU thought had been agreed. China is now insisting it did not sign any document agreeing to this timeframe. Other issues that are hanging over the talks concern intellectual copyright, the transparency of the judicial system and subsidies for state-owned enterprises, diplomats said. (China Daily, 24 October)

China-EU summit in Beijing: Business Dialog
The second China-EU Business Dialog was opened in the presence of Prime Minister Zhu Rongji, President Chirac of France and European Commission President Prodi. During the one-day dialogue, over 400 entrepreneurs from China and EU held in-depth discussions on bilateral cooperation in the information industry and new areas of bilateral trade and economic cooperation after China's WTO accession. (Xinhua, 24 October)

2000 Western Forum of China: Criticism from provincial officials and business leaders
Beijing has made development of the western hinterland a priority, but many officials and business leaders see little substance behind the cheerleading. According to many participants, the Forum in Chengdu highlighted how much bureaucrats in the west must change if they are to attract investment away from the east. They treat business people as though they are doing them a favor and often see new projects as an opportunity to make a quick profit. While everybody admits the need to reduce the income disparity to quell possible social unrest, business leaders say that Government money will not solve the problem. The market must decide, and more channels for investment must be opened. (South China Morning Post, 24 October)

Beijing trade unions unite under one umbrella
The new Federation of Trade Unions for Foreign-Invested Enterprises under the Beijing Foreign Investment Service Center was formed on October 23 to assist in collective bargaining and to settle potential disputes. The number of foreign-backed commercial enterprises working in Beijing passed 15'000 by the end of August. About a third of these began operations in 2000. Their industrial output accounts for 60% of Beijing's total exports. Personnel working in companies with foreign investments reached 448'700. (Beijing Qingnian Bao Beijing Youth Daily, 24 October)

Financial sector restructuring costs hit USD 302 billion
According to the People's Bank of China, the total cost of restructuring China's financial sector (restructuring of bad loans) has reached RMB 2.5 trillion, accounting for 31% of the GDP. The reorganization is the first fundamental reform of China's financial sector in 20 years. (ChinaOnline, 25 October)

Preferential income tax policy to continue in 2001
The existing tax policy will remain in place through 2001, with the approval of the State Council, according to the Ministry of Finance. The preferential policy mandates that, first, the official income tax of 33% be levied on listed companies, then 18% be rebated, so that listed companies enjoy an actual preferential tax rate of 15%. (ChinaOnline, 25 October)

IFC report: Most of China economy not state-owned
According to a report by the International Finance Corp. (IFC), the private sector, which has been growing at an exponential rate the past two decades, now nearly equals the contributions made to the economy by state-owned enterprises. Currently, private enterprise makes up 33% of GDP. If privately owned agricultural enterprises are included, the proportion may reach 51%. Taking into account collectively owned enterprises, the contribution of all non-state-owned businesses account for around 62% of GDP. (ChinaOnline, 26 October)

Beijing clears European Union hurdles in accession deal
Obstacles between the European Union and China to Beijing joining the WTO have been resolved. "What this means is that, having finally got our bilateral problems out of the way, we can now concentrate on the outstanding multilateral issues." An EU spokesman commented. However, the talks may be delayed after the talks' Swiss chairman, Pierre-Louis Girard, was admitted to hospital following an accident. (South China Morning Post, 28 October)

Legislators call for revision of foreign trade laws
Chinese legislators are calling for thorough revision of foreign investment regulations as early as possible to unify standards on identical clauses. There are currently more than 1'300 national and local laws and regulations that do not comply with the rules of the WTO. A bill signed by Premier Zhu Rongji on the revision of three laws concerning Sino-foreign joint ventures, Sino-foreign co-operative ventures and wholly foreign funded ventures, was presented to the top legislature this week. (South China Morning Post, 28 October)

Shell seals largest contract in China
Oil giant Shell signed a USD 4.05 billion contract with its Chinese partners to jointly invest in a petrochemical project, the largest Sino-foreign joint venture in the country so far. The CNOOC and Shell Petrochemicals Company Limited is jointly set up by China National Offshore Oil Corporation (CNOOC), Guangdong Investment and Development Company in south China's Guangdong province and Shell. Shell holds a 50% stake in the joint venture. (Xinhua, 29 October)