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Wed, Jul 28, 2004 - Page 12 News List

Wen says China to level playing field for private firms

AP , Beijing

China's leaders are promising to create a level playing field for private businesses by granting them the same ``preferential treatment'' given to state firms and repealing restrictive laws, state media said yesterday.

Premier Wen Jiabao (溫家寶) said in a statement that the government would ``encourage, support and guide'' companies, newspapers reported.

Wen's statement was one of China's most explicit promises yet to treat entrepreneurs equally with state companies. The ruling party amended China's Constitution in March to protect private property rights for the first time.

China's membership in the WTO requires it to repeal special protections enjoyed by state companies. But Wen's emphatic public endorsement could help to compel compliance by officials who want to protect local companies and can obstruct efforts to meet such commitments.

China relies on private business to drive growth and create jobs for millions of unemployed workers. Until recently, however, state companies have had better access to loans by government banks, regulatory protection and other official favors.

Private businesses will get equal treatment in investment, taxation, land use and foreign trade, the China Daily quoted Vice Premier Zeng Peiyan (曾培炎) as saying at a forum on Monday in Qingdao.

Zeng said companies also would be allowed to invest for the first time in utilities and other public projects.

In addition to the constitutional reform, Chinese leaders are pushing state banks to lend more to private companies and opening access to the country's two stock exchanges.

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