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New Rules Promote Business
Local enterprises engaged in foreign trade have discovered it is more efficient to do business this year thanks to new rules introduced by the State Administration of Foreign Exchange (SAFE) Shanghai branch.

Shanghai is the first city in China to implement rules that lower the standards for local enterprises to set up settlement accounts for foreign exchange, simplify the verification of export proceeds by using e-business solutions and lifting some restrictions.

"Foreign currency control on local businesses has been too strict, which increases their trade costs and decreases their competitiveness in the global market," said Fang Shangpu, deputy director of the SAFE Shanghai branch.

Some of the rules conflict with the World Trade Organization's (WTO) principles of fair competition and national treatment provisions.

Not all domestic enterprises are allowed to open settlement accounts for foreign exchange, in order to give the government better supervision of the flow of foreign currency, while all foreign companies are free to do so.

Since China has joined the WTO, it is time to revise the provisions to create a fair environment, thus sharpening local firms' competitive edge, Fang said.

(China Daily November 19, 2001)

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