‘Buy China’policy blasted
- Source: Global Times
- [07:22 June 18 2009]
- Comments
By Zuo Xuan
The guidance issued by Chinese government agencies recently to regulate governmental procurement was widely covered and criticized by foreign media yesterday.
“The whole world is dying to see China spread its orders around and save their economies,” Dong Tao, chief China Economist for Credit Suisse, was quoted by the Financial Times as saying. “But what this policy reflects is heightened anxiety about job pressures and the potential for social unrest.”
“It will strike many as odd that China is prepared to risk stirring up trade protectionism given the importance of export manufacturing to employment and gross domestic product growth,” Hong Kong-based economist Ben Simpfendorfer told Bloomberg yesterday.
The American Chamber of Commerce in China issued a statement warning against protectionism in stimulus packages in either China or the United States.
“It is critical that spending decisions related to the stimuli are made with economic and social, not political, rationales in mind,” the statement said.
What the media addressed is a directive from China’s National Development and Reform Commission and another eight agencies that requires government procurement give priority to domestic products and to report and obtain approval from the authorities when imported products are indispensable.
He Weiwen, managing director of China Society for World Trade Organization Studies, told the Global Times that the so-called “Buy China” policy is not aimed at imposing restrictions on foreign products. “In fact, it is the products made by China that receive more discrimination than foreign products,” he said.
Zhao Ping, a researcher at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times a prevailing view among some Chinese since the opening-up of China in 1979 is that foreign-made products are better in quality than domestically produced ones.
“The notice by the nine ministries and commissions is aimed at changing the situation when possible. Even if the financial crisis had not happened last October, China would have done that as well. So it basically has nothing to do with protectionism,” Zhao said.
Zhang Yansheng, director of the Academy of Macroeconomic Research at the National Development and Reform Commission, told the Global Times, “It is hard to tell which products are made exclusively by Chinese enterprises now given the high-level of globalization. BMW and Mercedes-Benz are made in China as well.”
Recently the Chinese government has included BMW and Mercedes-Benz on its list of State-financed vehicles and brought public criticism that the luxurious cars are beyond the burdon of public finance.
Zhao also said it is reasonable for the government to buy taxpayers’ goods made by them.
“The government has taken the distance factor into consideration. Domestic manufacturers help reduce transportation costs,” she added.