China's Wen reassures foreigners on investment climate

Chinese Premier Wen Jiabao answer a question during a meeting with entrepreneurs from various countries at China Development Forum at the Great Hall of the People in Beijing March 22, 2010.

BEIJING (Reuters) - Chinese premier Wen Jiabao reiterated reassurances to foreign companies that they will not be discriminated against in the Chinese market, while calling on European leaders to recognise China as a market economy.

Wen's comments after meeting with European Commission president Jose Manuel Barroso on Thursday come a few days before China is due to implement sweeping new regulations on standards, that foreign technology firms and manufacturers say will raise the costs and risks of doing business in the country.

"I want to state that the Chinese government will unswervingly implement a policy of opening to the outside world," said Wen. China would strive to give all businesses, Chinese and foreign, a "market environment of fair competition", said Wen.

"The policy of encouraging indigenous innovation treats all businesses in China the same. It will not exclude foreign companies."

Foreign firms have expressed concern about China's indigenous innovation rules, which would provide an incentive to government bodies to purchase products developed, and not just made, in China.

China is "actively and conscientiously preparing" to join the World Trade Organisation's agreement on government procurement, he added.

The complex world of technical standards has become a flashpoint of trade friction between China and developed economies.

Japanese, European and American firms say China could use the new rules to create standards different from the rest of the world, impeding trade and raising the costs of manufacturing and compliance.

EU trade chief Karel de Gucht said earlier this week the EU had sent a letter asking for the delay and further consultations on the Chinese compulsory certification, or CCC, which are due to come into effect on May 1.

But China may try to trade any concessions on that front for progress in achieving market economy status from the European Union.

De Gucht said Chinese Commerce Minister Chen Deming also brought up the issue of market economy status during their meetings.

Noting that the world economy still needs time to shake off the impact of the global financial crisis, Wen reiterated calls against protectionism and for a greater role for developing countries in international financial institutions.

"Although the impact of the international financial crisis is weakening and the global economy and trade are reviving, truly vaquishing this crisis will require countries to make constant efforts for some time yet," Wen said.

He added that this effort included "opposing all forms of trade protectionism".

(Reporting by Chris Buckley and Lucy Hornby; Writing by Lucy Hornby; Editing by Sugita Katyal)

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