Foreign Investment China

Income taxes for foreign firms in China have been cut to 10% from 15% to encourage more investment, the China Daily reported. It quoted Gu Ming, a senior official working under the State Council, as saying China would announce other new measures this month or next, including more flexible rules to deal with foreign exchange deficits, favorable wage and land rent terms and the right to hire and fire. Proposed foreign investment in China fell by 20% to $1.

China and Japan signed an accord Saturday designed to boost economic cooperation between the two countries by encouraging Japanese businesses to invest in China. "The investment protection agreement being signed today can be seen as a new starting point," Japanese Prime Minister Noboru Takeshita said at a press conference before the signing ceremony. "Medium- and small-sized enterprises in Japan are especially enthusiastic about investment in China. I have great expectations."

Chinese Premier Zhu Rongji announced new U.S.-China trade concessions on agriculture and generally charmed a luncheon audience of business, political and community leaders from Los Angeles and Orange counties on Tuesday. The 70-year-old economic leader in China's government said his country will eliminate restrictions against imports of citrus fruit from California and three other states and of wheat from seven U.S. states.

China hopes that its push for overseas capital will pull in at least $25 billion the next five years, with high-technology and service industries targeted for the fastest growth, an official said. Flexible investment policies and wider market access should make China a more attractive choice for foreign investors, said Jiao Sufen, a top official of the Ministry of Foreign Economic Relations and Trade. "A new rush of foreign investment in China is in the making," the newspaper China Daily said.

Most foreign-invested joint ventures are reporting profits despite skepticism and a cloudy business climate after the bloody crackdown on political dissent in June, a government news report said Friday. About 85% of the 8,000 Sino-foreign joint ventures that have started operations have been profitable, Xinhua News Agency said.

In an effort to reassure old-guard Maoists, China's leader, Deng Xiaoping, has ruled out a breaking away from communism in his drive to turn the country into a major economic power early in the 21st Century. "The basic things will still be state-owned, publicly owned," he said. His New Year's message was published on the front pages of the country's main newspapers Tuesday and printed under a scarlet masthead in the Communist Party newspaper People's Daily.

Does the second visit in seven months by North Korea's leader, Kim Jong Il, to China suggest that the North is "going Chinese"? Is Kim contemplating something like the Chinese path to reform? South Korea's President Kim Dae Jung thinks so: "This shows that North Korea is deeply interested in the Chinese-style reform and open-door policy and that it is trying to become a second China."

BEIJING -- Beijing filed a World Trade Organization complaint today over new U.S. tariffs on Chinese tires, stepping up pressure on Washington in the latest in a series of trade disputes. The conflict is a potential irritant as Washington and Beijing prepare for a summit of the Group of 20 leading economies in Pittsburgh on Sept. 24-25 to discuss efforts to end the worst global downturn since the 1930s. The Chinese complaint to the WTO in Geneva triggers a 60-day WTO process in which the two sides are to try to resolve the dispute through negotiations.