Japan, China, S Korea to negotiate investment pact from 2007
Jiji Press English News Service | 2006-12-07
Japan, China, S. Korea to Negotiate Investment Pact From 2007
Tokyo, Dec. 7 (Jiji Press) — Japan, China and South Korea have decided to start negotiations in 2007 with the aim of concluding a tripartite investment treaty, it was learned Thursday.
Leaders of the three countries are set to hold a meeting on the sidelines of the East Asian summit to be held in the Philippines next week and formally reach an agreement on launching the negotiations, informed sources said.
The focus will be on how much improvement in China’s investment environment Japan and South Korea can expect. China has been criticized for imposing a series of regulations on foreign firms and having investment procedures that lack transparency.
Japan has already concluded a bilateral investment protection agreement with China and an investment pact with South Korea.
The pact with South Korea, which took effect in 2003, stipulates that the two countries treat each other’s private sector in the same way they do their own.
In comparison, the agreement with China that came into force in 1989 mostly sets basic rules such as barring discrimination against foreign firms and forcible expropriation of investment assets. Globalization of corporate activities in recent years has all but rendered the pact obsolete.
Among China’s regulations on foreign firms is a rule that allows a foreign automaker to a build plant in China only if it has set up a joint venture with a local firm and the foreign automaker’s stake is 50 pct or less.
Japanese businesses often complain about China’s lack of written policy on regulations and how conditions for regulatory approval can suddenly change.
In the negotiations, the Japanese government is set to ask China to make its regulations transparent and boost the protection of intellectual property.
