Beijing may let foreign automakers control JVs, report says
The Chinese government likely will scrap a policy that limits a foreign automaker's stake in Chinese joint ventures to 50 percent, according to a Chinese media report.
Beijing faces pressure from the Obama administration to remove the restrictions as part of a bilateral investment treaty, reported Caixin, a Beijing-based business magazine.
Caixin cited comments by Miao Wei, China's influential minister of industry and information technology.
The treaty would require the two countries to ease regulatory restrictions on bilateral investment.
"The restrictions are severely questioned by the U.S. side," Caixin quoted Miao as saying during an automotive conference on Monday in Beijing. "What we can do is to resist the questioning for as long as possible. We will have to remove the restrictions in three to five years at the earliest, in eight years at the latest."
Under existing Chinese policy, foreign automakers must form joint ventures with Chinese companies if they want to produce locally. The foreign automakers are prohibited from owning more than 50 percent of a partnership.
Caixin cited comments by Miao Wei, China's influential minister of industry and information technology.
The treaty would require the two countries to ease regulatory restrictions on bilateral investment.
"The restrictions are severely questioned by the U.S. side," Caixin quoted Miao as saying during an automotive conference on Monday in Beijing. "What we can do is to resist the questioning for as long as possible. We will have to remove the restrictions in three to five years at the earliest, in eight years at the latest."
Under existing Chinese policy, foreign automakers must form joint ventures with Chinese companies if they want to produce locally. The foreign automakers are prohibited from owning more than 50 percent of a partnership.
