The European Chamber of Commerce in China released a report on Wednesday arguing that China’s procurement policy had deleterious effects on EU firms operating in the country, the Financial Times reported. “The regulatory framework for government procurement in China is a drag on efficiency and innovation for the Chinese economy as a whole,” the report said, adding that it “represents a missed opportunity the size of the South Korean economy for European business in China.” Specifically, the chamber argued that foreign firms are cut out of public contracts on the local and provincial government levels, despite promises from the national level to create a level playing field. Many analysts say the problem lies with China’s unusual two-tier procurement system, under which only a fraction of what is usually regarded elsewhere as procurement contracts are regulated under official government procurement law.
Categories