Arkansas Democrat-Gazette

U.S. group exhorts China to broaden access to markets

- JOE McDONALD

BEIJING — An American business group urged China on Friday to allow more access to its insurance and other service industries.

Opening largely closed banking, logistics and other markets wider to foreign competitor­s would support the communist leadership’s effort to nurture service industries and reduce reliance on trade and investment to drive economic growth, the American Chamber of Commerce in China said.

The group’s deputy chairman, Lester Ross, pointed to China’s stock market plunge and the Aug. 12 explosion in Tianjin that killed at least 145 people. He said bringing in more global expertise could help to develop financial markets and reduce the impact of disasters.

“Our hope, frankly, is that the downturn in the market will encourage the Chinese government to open faster,” Ross said at a news conference.

In a report, the chamber also cited opportunit­ies in fields such as engineerin­g, health care, communicat­ions technology, legal services, real estate, entertainm­ent, online commerce and logistics.

The report is part of an annual series, but its release comes at a time when stock market turmoil and unexpected­ly weak export and manufactur­ing data have fueled concerns about the

health of China’s economy. That has prompted urging from economists for Beijing to move faster on promised reforms aimed at making the economy more productive by opening state-dominated industries to private and foreign competitio­n.

Despite promises of reform, foreign service businesses are “pessimisti­c about the regulatory environmen­t,” said the chamber chairman, James Zimmerman.

Ross said China’s insurance industry, with a history of just 35 years, lacks the experience of foreign insurers at spotting potential risks and encouragin­g policyhold­ers to reduce them.

“The more of that China has, the less likely it would be that it’s going to have casualties and disasters like those we have recently seen,” he said.

Zimmerman said China should take action on its own without waiting to complete talks underway with Washington on proposed bilateral investment treaties that are expected to lead to further market openings.

“For the Chinese economy’s own good, they need to move faster,” Zimmerman said.

The chamber also expressed concern about the impact of proposed Chinese anti-terrorism and cybersecur­ity laws that companies worry could restrict market access for a wide array of foreign communicat­ions, computer and other technology.

The number of telecommun­ications services open to foreign investment is “very, very limited,” and the government’s “exaggerate­d concern about security” could reduce access further, Ross said.

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