The government has pledged to continue the work on reforms and development began two decades ago. Hu pledged to the delegates that he would “faithfully perform the powers and functions endowed by the Constitution, scrupulously discharge his duties, work hard and industriously and serve the country and the people with utmost sincerity.” Wen Jiabao in a press conference held after the conclusion of the meeting laid out the main objectives of the new government, namely to “achieve one goal”, “implement two key policies”, “solve three major economic problems” and “promote reforms in four major aspects”. One goal refers to continued maintenance of a sustainable and comparatively rapid development of the national economy and improvement of people’s living standards. Two key policies include the strategic economic restructuring and opening up to the outside world. The three problems that need to be resolved include unemployment and the social security system, increasing fiscal revenue and cuting public spending, and correcting and standardizing the economic order. The four reforms include the reform of the rural economy, the reform of state-owned enterprises, the reform of financial system and the reform of governmental agencies. It appears that the issues of equality and social justice have been given highest priorities by the new administration. The new leaders promised to provide eight million new jobs this year alone to combat the mounting unemployment crisis in China. New Taxes will be leveled on people with higher incomes. Rural reform will also be crucial to China’s drive to achieve a more affluent society that benefit all people.

Political reform was not a priority at the meeting. Instead, more institutional reforms are endorsed. Compared with previous institutional reforms, this time the emphasis will be on the changing roles and functions of the government. Under the government restructuring plan, the State Council will form a new commission for the management of state property, to be responsible for the reform and reorganization of state-owned enterprises, and a new commission to regulate the banking industry. A new Food and Drug Administration on the basis of the State Drug Administration will be established to reinforce supervision over the safety of food, health products and cosmetics. A new Ministry of Commence will be created to replace the Ministry of Foreign Trade and Economic Cooperation and the State Economic and Trade Commission.

The post China Elected New Leaders appeared first on China Research Center.

Permissible Investments

The Restructuring Regulations identify the permissible means by which “a foreign company, enterprise or other economic organization or individual” (a “Foreign Investor”) may acquire equity or assets held by state-owned enterprises or unlisted companies with state shareholdings (collectively, “SOEs”). Specifically, a Foreign Investor may:

· acquire the property rights of an SOE

· acquire the existing equity held by an SOE

· inject capital into an SOE in return for newly issued equity

· acquire all or substantially all of the assets of an SOE

· assume debt of the SOE from domestic creditors

The Restructuring Regulations do not themselves restrict a Foreign Investor from investing in particular industries; however, any such prohibitions contained within the Industry Catalogue Guiding Foreign Investment will continue to apply, as will existing rules mandating Chinese control of certain enterprises.

Criteria for Investors

China’s first phase of economic liberalization focused on using foreign investment to increase exports out of China. More recently, China has sought to attract foreign investment that also advances the capabilities of China’s domestic business and industry. This policy is reflected in the criteria for Foreign Investors contained within the Restructuring Regulations. For instance, a qualified Foreign Investor must possess the business qualifications and technical expertise commensurate with the needs of the SOE, a requirement that appears to exclude purely financial investors from directly participating in foreign investments into SOEs. The Foreign Investor also must exhibit good management capabilities and a good business reputation and must operate from a solid financial position.

Restructuring Plan

The creation of a “restructuring plan” is the first step in pursuing an investment under the Restructuring Regulations. The restructuring plan is essentially a business plan for the entity into which an investment will be made, addressing internal corporate governance, product development, enhancements of technical expertise and capital investment.The SOE submits the final restructuring plan as part of its application package to the relevant governmental authority for approval.

Valuation

Under the Restructuring Regulations, the applicable SOE must perform a valuation of all assets and equity to be acquired by a Foreign Investor. This valuation, which must be conducted in accordance with the Administration of State Asset Valuation Procedures and Provisions of Certain Issues on the Administration of State Assets Valuation, serves as the basis for determining the acquisition price.

Approval

A proposed investment must satisfy multiple requirements in order to obtain governmental approval. Additionally, depending on the type of transaction, certain parties must consent to or have an opportunity to give an opinion on the proposed investment. For instance, if the investment would result in the transfer to a Foreign Investor of the controlling interest in an enterprise or of all of the main assets of an enterprise, an “appropriate plan to settle the staff and workers” is required and such plan is subject to approval by the effected employees and the worker congress. This last requirement serves as a reminder not only that the approval of investments in SOEs may be influenced by social as well as economic factors, but also that any investment may entail labor issues to which a Foreign Investor may not be accustomed.

Summation

As is common with Chinese laws, the Restructuring Regulations contain room for uncertainty and capriciousness in their application. One important example is the failure of the Restructuring Regulations to clearly identify which governmental agency holds ultimate authority to approve an investment. An additional unknown is the impact that China’s social stability concerns will have on the approval and requirements of foreign investments. If past history is a guide, these concerns will not deter foreign investors from seeking to participate in the potentially rewarding opportunity to participate in the disposition of state-owned assets in China.

The post Foreign Companies Allowed To Purchase State Assets appeared first on China Research Center.

Kiang is no stranger to China — he was born in Shanghai in 1939 but grew up in Taiwan. He speaks four Chinese dialects fluently. After receiving a bachelor’s degree in physics from National Taiwan University in 1962, Kiang came to Georgia Tech for graduate work, eventually earning a master’s and a doctorate in physics. While a student at Tech, a narrow brush with death shaped his future.

“In 1964, I learned I and another Chinese student had tuberculosis,” Kiang said. “I lived and he died.” Kiang said he was saved by the actions of Vernon Crawford, then the associate director of the School of Physics. Crawford, who later became chancellor of the Georgia Board of Regents, drove Kiang to Rome, Ga., and admitted him to a state hospital that specialized in the treatment of TB.

“After that I stayed with him and his wife, Helen, at their home for a year,” Kiang said. “They took care of me. They even paid my medical and school bills and never asked for anything back. Later he said that he was adopting me as his ‘Number One son’ since he had two daughters.”

After earning his doctorate in 1970, Kiang worked at the National Center of Atmospheric Research in Boulder, Colo., until 1978, when Crawford asked him to return to Atlanta to develop and direct Tech’s Atmospheric Sciences program.

“I was very happy in Boulder,” he said. “But when Dr. Crawford called, I came back. Up until his death, he always said, ‘Please, don’t leave.’ That’s a significant reason why I stayed at Tech for the rest of my career.”

Kiang was the first director of the Office of Environmental Science, Technology and Policy, and was a founding director of the Southern Oxidant Study, an alliance of government agencies, national laboratories, academic institutes and private industries studying air quality in the southern United States.

China’s environment has suffered in the past 20 years from rapid development. Its cities are some of the most polluted in the world, which could present a major threat to continued economic growth. Kiang hopes his ideas will promote solutions to those environmental problems.

“This is a chance to do something with global impact,” he said. “I think my theme over there will be ‘what China can do for the world.’ I want to emphasize that if China’s environmental resources can be sustainable, then China can help the world. The college at Peking University will not just be concerned with ecological issues. We will also offer urban and regional planning, environmental geoscience resources and environmental design. We may be the first college in the world to look at the environment holistically.”

Kiang said China’s environmental situation is much more immediate than the United States. “Take, for example, Atlanta’s water resources,” he said. “We still have enough, but 30 years from now, our supply will be met with demand. China has to deal with those situations now — they don’t have 30 years. Smart growth in China is a necessity and if they can do that, then they can offer help to other developing countries in South America, southeast Asia or Africa.”

State economic leaders consider Kiang a critical link between China and Georgia. He has served as an adviser to U.S. companies entering China since that country established its open door policy in the 1970s and was one of the founders of China/Tech, a joint high-technology information exchange program. Kiang is confident China can handle environmental growth as well as it has handled economic growth.

“Americans think China is very slow to change, but that’s not a valid assumption,” Kiang said. “For the past 20 years, China’s economic growth has been historical. They developed economically in 20 years what took the West 200 years to do.”

The post A Yellow Jacket in Beijing: Environmentalist C. S. Kiang Named Dean at Peking University appeared first on China Research Center.