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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Liatris Spicata who wrote (9326)	9/15/1999 8:30:00 AM
From: Liatris Spicata	Respond to of 9980

China, the Internet and Foreign Investment: (Condensed & edited by this poster) September 15, 1999 Top Chinese Official Declares Foreign Net Stakes Are Illegal By MATT FORNEY and LESLIE CHANG Staff Reporters of THE WALL STREET JOURNAL BEIJING -- A top Chinese official spoke out against foreign investment in the Internet, potentially closing off one of China's most promising sectors to foreigners and complicating its efforts to join the World Trade Organization. Minister of Information Industry Wu Jichuan strongly implied that foreign firms that provide Internet access or content within China are breaking the law. "No foreign investor is allowed to operate telecom networks or services," Mr. Wu said... [Chinese authorities consider operators of Internet portals and other content-providers as telecommunications operators LTS] The move may force a number of well-known Internet, media and financial firms to divest themselves of investments in the fast-growing sector, among them America Online Inc. ... and Dow Jones & Co. It could also sever a funding lifeline to a host of homegrown start-ups. "If this restriction is put into effect, China will be basically handing its Internet industry to Hong Kong," says Gregory Ray, an Internet entrepreneur in Shanghai. Mr. Wu's comments suggest a backtracking from Beijing's earlier promises to open its telecommunications sector as part of its bid to enter the WTO. In April, according to documents released by the U.S. government, Beijing agreed to let foreign firms take 49% stakes in mobile-phone firms and 51% stakes in value-added services, including the Internet business.