Trade dispute: China promises fair competition – investment law passed

Against the background of the commercial dispute with the United States and increasing criticism from Europe, China is targeting foreign companies and investors. In conclusion his annual meeting The People's Congress has voted in favor of a new law that addresses the discrimination of foreign companies in China and assures fair competition on the outside. "If we promise to open, we will certainly deliver," said China's Prime Minister Li Keqiang,

2929 delegates voted in favor of the law, eight against or abstained – in its history, the People's Congress has never rejected a bill. The new law removes the constraint of technology transfers from foreign to Chinese partner companies and prohibits "illegal government interference" in foreign business.

Foreign investments should basically be treated equally. The state must "protect copyrights" and ensure that companies from abroad are "not disadvantaged". However, there are still negative lists of economic sectors in which foreign investments or companies may not or only to a limited extent.

Signal of market opening

"It is a clear signal to the US, but also to Europe, that Peking Katja Drinhausen from the China-based Merics Institute in Berlin said: "In spite of substantial improvements, the law is above all a symbolic gesture, leaving enough room for Chinese leaders to impede access for foreign companies.

In response to the Trade dispute with the USA it was submitted accelerated. Both countries have been covering each other for months with high special tariffs. In the meantime, around half of all US imports from China are burdened with additional duties.

Li Keqiang Wished a quick end to the dispute, He hopes that the negotiations will produce "good results". The two largest economies in the world are closely intertwined. A decoupling is neither realistic nor possible.

Delegates of the People's Congress

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Delegates of the People's Congress

In the ongoing conflict had US President Donald Trump just before an agreement or a failure of the negotiations in the coming weeks in prospect. "We'll probably know one way or another in the next three to four weeks," Trump said at a White House reception. He commented positively on the progress of the talks, certifying that the Chinese side was "very responsible and very reasonable".

China expects slowest growth in 30 years

The US is calling for better market access in China, a reduction in the US trade deficit and more protection against piracy and forced technology transfer for US companies in China. The US is also bumping into state funding from Chinese companies, which in their view distorts the market.

The criticism of China's state economy is also growing in Europe. In response to the political and economic drive for power, the European Commission presented a ten-point plan on Tuesday to safeguard European interests.

In the meantime, the economic prospects in China are becoming increasingly gloomy as a result of the US trade war and the high level of debt. The growth target is only 6 to 6.5 percent, which would be the slowest growth in 30 years.

With more tax cuts and fewer taxes to counteract downward pressure, Li Keqiang announced, "We must certainly take strong action to cope with rising uncertainty." As concrete steps he called lower taxes on businesses and a reduction in social security contributions. So shall the Economy be cranked.

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