COMMERCE

China to rein in extravagant investment teams sent to Hong Kong, Macau

PUBLISHED : Friday, 30 August, 2013, 12:00am
UPDATED : Friday, 30 August, 2013, 9:50am
 

The Ministry of Commerce has pledged to rein in extravagance by local government delegations sent to Hong Kong and Macau to drum up investment, following a highly critical article about such trips in People's Daily.

Yao Jian, a ministry spokesman, told a press conference that Beijing was aware of the overblown nature of business delegations visiting Hong Kong and Macau, pointing out that some local governments had overstated the number of participants and the value of deals signed during their promotional activities.

They were desperate to get a big number of foreign businesspeople attending the events and re-signed agreements which had previously been sealed to shore up the total transaction value

"They were desperate to get a big number of foreign businesspeople attending the events and re-signed agreements which had previously been sealed to shore up the total transaction value," Yao said, according to a statement on the ministry's website. "The phenomenon reflects a severe level of artificiality and extravagance."

He added that the ministry would do its utmost to avoid wasting public funds.

His remarks followed the flagship newspaper's harsh criticism on Monday of investment delegations travelling to Hong Kong.

This was the first time that a Communist Party mouthpiece had fired a salvo at such investment-promotion practices.

People'sDaily also said anti-graft officials would investigate and punish those who outrageously wasted money on trips, because their behaviour tainted the government's image.

Over the past three decades, Beijing has encouraged local governments to look outward to attract foreign investment.

Foreign direct investment is a key economic indicator used to gauge officials' performance, and dozens of delegations from local governments flock to Hong Kong every year to seek such investments.

Yao admitted that the delegations played a positive role in spurring the nation's economic growth and creating jobs.

But he added: "As superficiality and lavish spending characterised such investment promotion activities, it is necessary to enhance oversight of the practices."

The People's Daily article and the remarks by Yao were fresh signs that the central leadership is stepping up efforts to cut down on extravagance.

Previously, investment junkets were believed to be immune from the campaign against official extravagance.

The People's Daily said business delegations stayed in five-star hotels and invited businessmen to expensive restaurants, spending as much as 1,000 yuan (HK$1,260) per head for a breakfast meeting.

It is also an open secret that government officials on these delegations snap up luxury items for their own use during the trips.

Yao said the ministry was drawing up guidelines governing investment delegations that would require local governments to focus on foreign-funded projects to ensure that funds were used properly.

 

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