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Firms told to invest overseas BEIJING has ordered its top 120 companies to invest abroad in an effort to bolster the country's sagging exports, official media said. ``China will select 120 large enterprises and 1,000 key enterprises to undertake pilot investments abroad in the form of equipment, expertise, raw materials and parts,'' Xinhua News Agency said, citing the Ministry of Foreign Trade and Economic Co-operation (Moftec).
Special policies will be introduced ``to encourage companies in the machinery and electronics, light industry and textile sectors to invest abroad,'' Moftec officials said.
The selected companies will be encouraged to establish overseas ventures to assemble and manufacture products such as automobiles, motorcycles, small farm machinery and equipment, television sets, refrigerators, washing machines and electric fans.
Trade Minister Shi Guangsheng said the policies were aimed at promoting overseas processing with domestically manufactured materials ``in order to increase exports of Chinese products, equipment, raw materials, parts and labour services.''
The mainland, affected by the East Asian economic crisis, posted virtually flat export growth in 1998, when overseas sales earned around US$182 billion (HK$1.42 trillion).
Sun Weiyan, president of the University of the International Business and Economics, said overseas investments will benefit both the mainland and recipient areas. ``Investments will help increase exports of Chinese equipment, technology, raw materials, semi-finished products and parts, in addition to raising employment rates in areas attracting investment, helping to restructure local economies, upgrading technological levels and multiplying market supply,'' Mr Sun was quoted as saying.
Chinese companies had established over 5,600 projects in more than 160 countries and regions, including Asia, Africa, Latin America, Eastern Europe and Central Asia, by the end of 1998, Xinhua reported.
Related projects involved total investments of over US$9 billion (HK$70.20 billion), with contracted investments from Chinese partners amounting to US$6.33 billion, it added. - AFP
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