BEIJING - Opaque auction laws, pure and simple patronage and other practices by China effectively bar foreign companies from winning public contracts, a market equal to one-fifth of China's economy, a group of European companies, said Wednesday.
A study by the Chamber of Commerce of European Union in China adds to growing complaints from major trading partners that foreign companies are treated unfairly in the huge Chinese market and growing. Public procurement are particularly important, because government agencies play a major role in the economy, as funders and referees for submissions, said the Chamber of the EU.
Bidding on government procurement, "every step of the process, you have defects and difficulties with room for a non-equal playing field," President of the Chamber, Jacques de Boisseson said at a press conference. A European information technology executive cited in the study said the tender process "may seem pure protectionism and it's really frustrating."
Even after three decades of free market reforms, the Government and State-owned enterprises dominate vital elements of the Chinese economy. Study of the House of the European Union supports a broad interpretation of the involvement of the State, public contracts defining as including all infrastructure projects of certain purchases made by public companies and public institutions.
By this measure, the study estimates that China's Government procurement totals 1 billion dollars, or 6.8 billion yuan, or a year - about 20 per cent of the overall economy.
In trying to win public contracts, foreign companies often have difficulty obtaining information on the conditions of submission, the study said, while the practices set out in laws and regulations are implemented unevenly, often through local businesses.
Procurement became one of several prominent irritants in relations of China with partners in recent years commercial, as the size of the Chinese market soared while developed economies dark. The authoritarian Government has used potential access to the growth of the market as leverage, the development of policies to persuade multinationals to turn technology and open several factories and research facilities.
Preferences granted to domestic firms through policies and procurement have drawn complaints from large multinationals and American, Japanese and European governments.
Washington filed a record in the World Trade Organization last year challenging grants China gives managers clean energy of the complaint that allows them to sell solar and wind power unfairly low-priced equipment.
In the example cited by the study of the House of the EU, the wind turbine manufacturers face rules requiring that 70% of the wind farm equipment had to be taken locally - a requirement some interpreted strictly local governments that Chinese manufacturers from other provinces were sometimes excluded. Although Beijing branded the requirement of last year, some Governments are apparently continue to apply, the study said.
The study is not the name of names. But Vestas Wind Systems A/s for the Denmark, the more wind manufacturer had difficulty to give competing elbow side Chinese to China and on behalf of increasingly faces abroad.
"It seems that we are never"national"enough," the study cites an Executive for manufacturing wind power said.
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