China investment environment unchanged despite Google incident

21:53, March 23, 2010      

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Western media recently claimed that China's investment environment is worsening, citing Google's threat to withdraw from China as evidence for the claim.

The incident has not caused any changes in China's investment environment. Instead, it can only affect Google's development in China. When it was allowed into the country four years ago, Google promises to abide by information censorship in line with Chinese laws and regulations. But now, Google has suddenly broken its promises and accused China having a deteriorating investment environment just because its demands were rejected. Google's practice is irrational.

Google once hyped the online attacks by Chinese hackers by linking it with the Chinese government. However, the company has not presented any clear evidence to support its accusation so far. Hackers are a major feature of the Internet age and China is also a victim of online attacks. What is Google trying to accomplish by associating online attacks with the Chinese government?

Google is not a model for foreign-funded enterprises. By the end of 2009, China's foreign direct investment totaled 1 trillion U.S. dollars, while Google had only invested tens of millions in China. On the other hand, there are 660,000 foreign-funded enterprises in China and 480 of the world's top 500 enterprises have entered China.

China's state leaders and government officials have expressed China's willingness to adhere to the road of reform and opening up. Investment from foreign enterprises has brought win-win situations in China. On one hand, foreign enterprises can contribute to China's economic development by bringing funds, technologies and advanced management philosophies to China. On the other hand, these enterprises can reap much higher profits in the Chinese market than in any other market in the world. As a developing country, China has been opening its door to foreign enterprises.

The claim that China's investment environment is deteriorating has not been echoed among the China-based branches of foreign enterprises, including the branches of American enterprises. Foreign enterprises that are really seeking business development are quite clear as to what treatments they are entitled to in China. For example, many multinationals have encountered large setbacks in the U.S. and Europe since the international financial crisis broke out in 2008. Some of them have even suffered heavy losses while others are on the verge of bankruptcy. However, they still reap high profits in China. Some foreign enterprises use profits reaped from the Chinese market to make up for their losses.

According to analysts, Google's rivals will quickly fill the vacancy once it formally withdraws from China. Some IT giants such as Microsoft and Hewlett Packard have expressed their interests in the Chinese market and have voiced their willingness to expand their presence here.

Qin Gang, spokesman for the Ministry of Foreign Affairs, said that Google's withdrawal from China is only one isolated measure taken by one foreign enterprise, and it will not affect China's investment environment, nor can it change the reality that most foreign-funded enterprises have been operating smoothly and reaping high profits in the Chinese market.

By People's Daily Online
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