China Rethinking>
China Considers Opening Telecom Market
Xinhua English Newswire
China is striving to open its telecommunication service market to overseas
operators by restructuring its telecommunications industry.
Wang Jianzhou, director-general of the Planning Department of of the
Ministry of the Information Industry (MII), told a press conference here
today that there is yet no exact timetable for opening up the country's
telecommunication service market.
However, he noted that China is doing such jobs as separating postal
services from telecommunication services and delinking operation companies
from MII.
"These efforts are aimed to create a fair and equal competition environment
for both Chinese and overseas operation companies," he said.
He said that the recent government investigation of foreign fund utilization in
China Unicom, the sole competitor to the state-owned China Telecom in the
operation sector, does not mean closing doors to foreign investors.
He pointed out that the investigation is conducted against certain activities
that violated the existing Government policies. It is designed to protect the
interests of foreign investors, and the results of the investigation will be
released soon.
He reiterated that China will continue to encourage competition and foreign
investment in the telecommunications sector.
"the operation market is not mature enough for opening to overseas
companies," he said. He gave four reasons for that.
First, preferential government policies constitute a significant percentage of
revenues of the operation sector. Therefore it will be hard to divide profits
between Chinese and foreign investors.
Second, at present, China transfers profits from operation companies in the
eastern part of the country to the loss-making ones in the western part of the
country. This will cause a problem in offering universal services of the same
quality to people around the country.
Third, the fee collection system of the operation sector has yet to be
liberalized.
Fourth, China has yet to enforce a telecommunications law to regulate
market competition.
Wang said that China is accelerating the process of restructuring the
telecommunications industry and drafting the telecommunications law.
(Copyright 1998)
_____via IntellX_____
Publication Date: December 01, 1998
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