Trade dispute with the US: China's People's Congress promises to be open by law
TIME ONLINE | News, backgrounds and debates
Beijing (dpa) - Against the background of the trade dispute with the US and increasing criticism from Europe, China is approaching foreign companies and investors.
At the end of its annual session, the People's Congress blessed a new law that addresses the discrimination of foreign companies in China and assures fair competition to the outside world.
"If we promise to open, we will certainly deliver," said China's PM Li Keqiang at a press conference following the People's Congress. The new investment law was designed "to protect the rights and interests of foreign investors".
"It is a clear signal to the US, but also to Europe, that Beijing is taking further steps to open the market," said Katja Drinhausen of the China Institute Merics in Berlin. Despite "substantial improvements", the law is above all a symbolic gesture. The Chinese leadership still had enough leeway to make access for foreign companies more difficult.
Observers pointed out that the bill had been speeded up in response to the US trade dispute. Both countries have been covering each other for months with high special tariffs. In the meantime, around half of all US imports from China are burdened with additional duties.
Li Keqiang wished for a quick end to the dispute on Friday. He hopes that the negotiations will produce "good results". The two largest economies in the world are closely intertwined. A decoupling is neither realistic nor possible.
In the current conflict, US President Donald Trump had recently announced an agreement or a failure of the negotiations in the coming weeks. "We'll probably know one way or another in the next three to four weeks," Trump said at a White House reception Thursday night. He commented positively on the progress of the talks and certified that the Chinese side was "very responsible and very reasonable".
The US is calling for more market access in China, a reduction in the US trade deficit and better protection against piracy and forced technology transfer to US-based companies operating in China. The US is also bumping into government funding from Chinese companies, which in their view distorts competition.
China's PM dismissed allegations that Chinese companies were spying for the state overseas. "We did not and will not do that in the future," Li Keqiang assured.
The criticism of China's state economy is also growing in Europe. In response to China's political and economic aspirations, the European Commission tabled a ten-point plan on Tuesday to safeguard European interests.
The central element of the new investment law of the Chinese is the fundamental equal treatment of foreign investment. The state must "protect copyrights" and ensure that foreign companies are not "disadvantaged", but "equal" to participate in the competition, it said in an official explanation of the law. A prescribed technology transfer is prohibited. However, there are still negative lists of economic sectors in which foreign investments or companies may not or only to a limited extent.
In view of the trade war with the US and the high level of debt, China's economic prospects are becoming increasingly gloomy. With more tax cuts and fewer taxes to counteract downward pressure, Li Keqiang announced, "We must certainly take strong action to cope with rising uncertainty." As concrete steps he called lower levies for companies. This is how the economy should be stimulated.
Li Keqiang expressed confidence that Beijing could achieve the growth target of 6 to 6.5 percent this year at the People's Congress. It would be the slowest growth in 30 years.
The People's Congress also approved spending on the new budget on Friday, rising by a total of 6.5 percent. With 7.5 percent, the military gets back significantly more. In its history, the People's Congress has never rejected a template.
Xinhua to People's Congress