Liu Tienan, the deputy chief of the National Development and Reform Commission, the mainland's top economic planner, reiterated last Friday that in all the stimulus measures Beijing has rolled out, not one buy-local clause had been included.

'Though some of our [export-reliant] domestic industries have been affected by protectionism abroad, we would not make any similar manoeuvres in our own economic stimulus plans [in retaliation] ... neither in trade nor in employment,' he said.

Mr Liu is one of a number of high-ranking officials over the past month to allay any suggestion of 'buy local' provisions in China's massive stimulus efforts, which include 4trillion yuan (HK$4.54 trillion) spending on public infrastructure projects and pump-priming in 10 pillar industries.

Deputy Commerce Minister Jiang Zengwei was the first mainland policymaker to raise the subject in public early last month while lashing out at the 'Buy American steel' provision passed by the US Congress as part of President Barack Obama's US$787 billion stimulus package.

Commerce Minister Chen Deming led a delegation of Chinese entrepreneurs on a highly symbolic shopping tour in Europe in mid-February that brought a windfall US$13 billion to manufacturers in Britain, Switzerland, Germany and Spain.

The trip was largely interpreted as a sweetener in China's bid to stall the growing buy-local trend in embattled developed economies.

To date, no explicit protectionist provisions have been found in the central government's rough guidelines for various stimulus plans. Yet observers warn that once Beijing puts more flesh on the bones, controversies could emerge.

'In one way or another, protectionist thinking has long been etched in the government's policies,' said Jun Ma, an economist at Deutsche Bank. 'They are now very careful to get it right with the rhetoric [in stimulus packages].'

A copy of the light industry bailout plan, acquired by the South China Morning Post, urges 'governments of different levels to give priority to homegrown light industry products' in procurement schemes. But this instruction was omitted in a summary publicised on February 19.

The state-backed Beijing Morning Post also revealed the presence of a provision in the soon-to-be-unveiled detailed final version of the vehicle industry bailout that requires at least half of the government's enormous official car fleet be 'self-owned brands'.

But even if these clauses are enshrined as established policies, Beijing has a ready defence. For a start, it has yet to sign the World Trade Organisation Agreement on Government Procurement, which safeguards free trade principles in government buying. China entered the negotiation for the treaty in late 2007 in line with the commitment it made upon its admission to the WTO in 2001. Bargaining has been going on with little hope of an end anytime soon.

On the other hand, a threat to the credibility of the government's anti-protectionism vow lies in deep-rooted regional protectionism.

'China should have an internal WTO ... It's hard for a Hubei-built car to be sold to Shanghai's taxi companies whereas [it's hard] for [Shanghai-based] Volkswagen to sell sedans in Wuhan,' said Joerg Wuttke, president of the European Chamber of Commerce in China.

'In China's case, regional protectionism is much worse in terms of its economic impact. It's not against foreigners alone. Whoever produces in Hangzhou is in the same league [as a foreign company] when it comes to penetrating the market of another province.'

Chinese non-tariff barriers cost EU companies more than Euro21.4 billion (HK$209.02 billion) a year in lost business opportunities, a report financed by the EU Commission showed. Mr Wuttke said most of these losses stemmed from local protectionism.

'Now, as the economic crisis deepens, I fear the [local protectionism] tendencies will be reinforced,' said Mr Wuttke.

His fear is well placed.

In Hangzhou, the municipal government has begun subsidising purchases of locally made mobile handsets, refrigerators, television sets and washing machines, which effectively amounts to an 18 per cent price discount for these homegrown products.

Changchun City, the provincial capital of Jilin, has waived inspection fees for new vehicles made by local carmaker First Auto Works, creating an effective price advantage for FAW. Officials also required that at least 50 per cent of equipment purchases for large projects were sourced locally.

In Anhui, public infrastructure projects are required to use Anhui-made steel, concrete, doors and windows, glass, wiring and electrical equipment.

Raymond So Wai-man, a professor at the Chinese University of Hong Kong, said he did not see massive protectionism emerging, particularly in consumer goods, as 'urban Chinese customers have become brand-conscious and deem foreign-made goods synonymous with quality'.

'But government procurement, especially by the local authorities, will be a different story,' said Mr So. 'And the reality that most of the public infrastructure projects, though mandated by the overriding central government stimulus plans, will have to be carried out and partly funded by local officials at the end of the day.'

Beijing will bankroll just over 25 per cent of the proposed 4 trillion yuan spending, leaving the rest to local governments and banks. That puts substantial bargaining power in the hands of provincial or city administrations, which, keen to safeguard the interests of enterprises in their jurisdictions, could add protectionist strings to their share of spending.

From Mr Wuttke's point of view, it is time for Beijing to nip the protectionist trend with resolve, as it could dampen the prospect of a quick economic recovery.

'I think there are going to be a lot of synergies in China, and a lot of possible GDP growth if China can knock down these domestic regional protectionist tendencies,' he said.