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The Ministry of Science and Technology
People's Republic of China

N0.270 September 10,2001

* New Foreign Investment Opportunities

* Absorb More Funds for Transport Infrastructures

* Return of Overseas Graduates Encouraged

* Sparkle Heading for the West

* Major Progress in Embryo Stem Cell Cloning

* China Joins Human Brain Project

* High Energy Physics Meeting in China


New Foreign Investment Opportunities

At China West Forum 2001, Sun Zhenyu, Chinese Vice Minister of Foreign Trade and Economic Cooperation made his presentation on new opportunities for foreign investment upon China's accession to the World Trade Organization, which aimed at further promoting foreign businessmen's active involvement in China's west development so as to stimulate the economic and social development of China's vast west region.

Mr. Sun expressed that to encourage foreign investors to enhance their investment in the middle and west regions of China and further stimulate the economic development in the regions, the central government has since 1999 worked out a series of favorable policies encouraging foreign investment in China's middle and west regions.  These policies have mainly covered six aspects including expanding the opening areas in the west regions, increasing investment approaches, loosening restrictions on foreign investment, providing more favorable taxation treatment for those investing in the areas that the Chinese Government encourages, enhancing banking support for investment projects and establishing national economic and technical development parks for better investment environment.  The Announcement on Implementing West Development Policies issued by the Chinese State Council has further updated and coordinated different policies on encouraging foreign investment in the west regions. Along with China's accession to the World Trade Organization, the Chinese Government will take actions in the following nine areas so as to absorb more foreign investment in the west regions.

1. Revising the Catalog on Advantageous Industries for Foreign Investment in Middle and West Regions, and taking advantage of the resources and economic strength of the west region, especially developing its special economies.

2. Updating the Interim Regulations on the Investment of Foreign Invested Enterprises in China, creating conditions, and promoting the re-investment of coastal foreign invested businesses in the west regions and realizing gradient industrial shifting.

3. Further expanding the areas absorbing foreign investment in the west, encouraging foreign investment in the basic fields such as agriculture, forestry, hydraulic works, transportation, energy, public utilities, environment protection, infrastructures construction and tapping mineral and tourist resources.

4. Formulating policies encouraging foreign investment in the following major national key projects such as the transmission of electric power from the west to the east, natural gas from the west to the east and water from the south to the north, and Qinghai-Tibet railroad system, so as to accelerate the infrastructure constructions of the west regions.

5. Working out policies and measures on foreign acquisition and merger of state owned enterprises, BOT and TOT based investment and overseas IPO process of foreign invested businesses.

6. Encouraging foreign invested businesses to import and develop advanced technologies and engage in technical innovations; guiding foreign invested businesses, especially multinationals to invest in establishing high tech industries and R&D institutions; encouraging foreign investors to run capital and technology intensive projects and open up more advanced technology oriented projects.

7. Further opening banking, insurance, commercial retail, foreign trade, telecommunication, tourism, building construction and associated services, China-foreign joint accounting firms and law firms in the major cities of the west regions, and duly loosen the restrictions on the establishment of the foreign invested businesses in these fields.

8. Encouraging small and medium enterprises to be part of the international cooperation, promoting foreign investment in projects on machinery and electronic products, components and parts, and supporting raw materials and foreign exchange making oriented projects;

9. Sticking to the policy on mainstreamed with industrial projects, absorbing foreign capital and export, striving to develop high technologies; going on to run the national economic and technical development parks well in the west so as to display their demonstration, mobilizing, radiation and stimulating roles.

Absorb More Funds for Transport Infrastructures

During the 10th Five-Year Plan period, China will adopt more flexible and favorable policies to attract more capital from both home and abroad to feed the construction and operation of transport infrastructures, while continuing its increasing utilization of loans from international banking institutions, foreign governmental loans and the loans from domestic banking institutions.

The Special Plan for Integrated Transport System Development for the 10th Five-Year Plan period issued recently by the Chinese State Development and Planning Commission points out that during the 10th period, China will revise its previous regulations on foreign investment by expanding the domains receiving foreign direct investment, easing the restrictions on the percentage of foreign equity and adopting positive fund raising policies so as to increase the direct investment percentage in transport infrastructure constructions. In the meanwhile, a corresponding anti-monopoly mechanism will be established to ensure the economic security.

The special plan provides that in the constructions of transport infrastructure, the one of public interests shall be the responsibility of the government and for the one serving the dual purpose of both public interests and commercial profit making, the government shall share the proportioned investment.

During the 10th period, China will improve its government based fund system and secure the stability of such fund through turning fee charging into tax collection. To avoid the possible weakening of governmental fund when transport tension is eased, the funds for transport infrastructure constructions and maintenance shall be secured with a steady increase through changing fee charging into tax collection.

The plan also mentioned that during the 10th period China would create industrial investment fund and issue long and medium term construction bonds to absorb the funds from society and individuals for transport infrastructure constructions.

The investment made by industrial investment fund may enjoy the relevant policies favorable for the foreign investment. When investing in the project having relatively poor economic returns by the industrial investment fund, the government may allocate appropriate subsidies or allow a controllable upper limit for investment return.

Return of Overseas Graduates Encouraged

Recently five Chinese governmental agencies including the Ministry of Personnel Affairs, the Ministry of Education, the Ministry of Science and Technology, the Ministry of Public Security and the Ministry of Finance jointly issued “Comments on Encouraging Overseas Chinese Graduates to Serve Their Motherland in Different Forms". The said document is the first of its kind encouraging overseas Chinese graduates to serve their motherland in an integrated and systematic manner. The Comments have made explicit provisions on the supporting policies and the forms of services for overseas Chinese graduates.

The Comments point out that overseas Chinese gradu ates' service for the country is defined as different activities aiming at promoting the nation's economic and social development by overseas Chinese graduates who are studying abroad or working abroad after the completion of their studies abroad, working for the businesses in the country by taking advantage of their professionalism or gathered professional forces, participating in the entrusted joint studies both at home and abroad, lecturing in China, conducting academic and technical exchanges, creating businesses in the country, engaging in study tours and consultation activities, and providing brokerage services.

The Comments encourage, on the basis of serving their own country through different approaches, to provide overseas graduates with seven forms of services including part time job, joint studies, entrusted studies, creating businesses, personnel training, serving the west regions and brokerage services.

The Comments point out that the state will provide policy guarantee for the serving country activities of overseas graduates. These policies are mainly set on providing budget and compensation. Serving the country is not a volunteer service without compensation, but rather a reasonably paid job for labor, brokerage and commission in line with international norms. The acquired income, after the deduction of taxes, can be exchanged into foreign currencies and remitted abroad. Their intellectual properties of special knowledge, technical patents and R&D results will be protected. Fine working and living conditions will be provided.   Also the state will facilitate entry and exit procedures and employment services and publicize the achievements of their services.

Sparkle Heading for the West

The master development plan of Sparkle Program for the 10th period issued recently by the  Ministry of Science and Technology indicates that during the said period, China will establish 20 Sparkle S&T demonstration counties in the west regions and develop a number of pillar industries of west characteristics.

Sparkle Program will, closely surrounding the west development strategies, strengthen R&D capacity of the west region, especially that of poverty stricken areas. The aim to relentlessly promote the advancement of Sparkle Program into the west region and remarkably improving S&T and cultural quality of farmers in the west will be achieved through the implementation of Sparkle projects, the construction of west Sparkle S&T demonstration bases and S&T cooperation mechanism between the east and the west. In the meanwhile, efforts will be made to enhance the capacity of farmers in the west so as to make them free from poverty and become rich with the help of science and technology. On that basis it is   certain to improve the production and living environment in the west, especially in the poverty stricken areas, successfully nurture S&T support capacity in the west regions, and eventually promote the full fledged coordinated development of economy, society and environment in the west.

During the 10th period, Sparkle Program will take projects as the tie, S&T demonstration as the means, S&T demonstration bases as the starting point, and poverty alleviation and becoming rich and regional economic development as the targets, and stick to the principles of cooperation between the east and the west, reciprocal supplement with each other, mutual benefits and common development, so as to remarkably improve the productivity level of the rural areas in these regions. 


 Major Progress in Embryo Stem Cell Cloning

On August 31, 2001, a research team of the Northwest University of Agriculture and Forestry separated a cell cluster of heartbeat from human embryo stem cells, the sixth of its kind achieved by the team. This is the only cell cluster with heart beat obtained by the  Chinese scientists from human embryo stem cell splitting, which marked China's world advanced human embryo stem cell studies.

In 1993, scientists of the Northwest University of Agriculture and Forestry started their studies on separation and cloning of embryo stem cells and in 1995 they successfully separated and cloned ox and pig embryo stem cells from the fetus in their early development stage and passed them on to two generations. Up to date, the said stem cells have carried on to the 7th generation in ox and the 5th generation in pig. In 1996, they separated cell cluster with heartbeat from mouse embryo stem cells and in 1997 separated and cloned human embryo stem cells from discharged fetus and carried them on to the 9th generation. This year has witnessed their cloning of skin stem cells from adult goats.

It is briefed that the team started their external separation and cultivation of embryo stem cells on August 25 and witnessed the cell clusters with a heart beat at 90 times per second.

Tracking Network Hacker

A network based hacker tracking system has recently passed the verification checks at Shanghai Jiaotong University by the joint experts panel on national information security application demonstration project. It is a filling in the blank for Chinese information management. The experts who nodded their approval believed that the network based hacker tracking system was able to track down the origin of hackers in a controllable and relatively closed computer network area. The development has landed a breakthrough over the former technology that was only able to tell the attacking of hackers instead of tracking down the origin, and realizing network wide supervision. The working concept on which the system is built, namely the distributive hacker tracking by taking advantage of network invasion testing, data fingerprint technique and controllable computer network, is also the first of its kind in the country.


China Joins Human Brain Project

It was disclosed at the founding ceremony of the Neuro Information Center of Military Hospital on September 6, 2001 that a team of Chinese scientists membered with Tang Xiaowei, an academician of the Chinese Academy of Sciences, Dr. Yin Ling and Dr. Tang Yiyuan would be part of the efforts of neuro-information working panel of the Global Scientific Forum in Sweden.  The development has made China the 20th country in the world that is  involved in the global human brain project.

Formally launched in 1997, the human brain project is another large international scientific research activity after the human genome project. In 2000, the neuro-information science working group was sponsored by the US under the guidance of OECD. Its phase I objective was to have the worldwide scientists organized to jointly study, develop, protect and create brains. Up to date, the human brain project has entered its phase II with the objectives of aiming at providing advanced information tools to enable neurologists and information scientists to associate brain structures with the results of brain function studies for database construction, to search, to do comparative studies and integration before working out charts depicting brain functions, composition and neuro-network.

China being the 20th country in the world involved in the said efforts, its studies in the field have come in line with international practice. At present, Chinese scientists are working on how to make the neuro-information studies of Chinese characteristics a starting point for its joining in the project, and establish China's own neuro information platform and database, so as to collaborate with the scientists of other countries in an efficient manner.

High Energy Physics Meeting in China

CHEP 2001, the conference representing top academic level of the world high energy and nuclear physics computation lifted its curtain on September 4, 2001 in Beijing. It is CHEP's first meeting held in China. 300 and odd participants including the representatives from a dozen of renowned research institutions such as the European Nucleus Center, the US based Fermi Lab, the Russian Dubna National Lab etc. were present.

The major theme of the meeting is network computation aiming at creating a large and interactive and cooperative high performance computer network by taking advantage of connecting together wide area network based computation resources, data resources and other facilities, so as to help extremely large scientific projects such as high physics experiments and genes decoding that call for world wide cooperation and massive data processing. At the five-day meeting, 180 special series presentations were made by Prof. Manuel De Ifino, Director of Information Technology Center, West European Nucleus Research Center, Matthias Kasemann, Director of Computation Center, US Fermi Lab and others.

China's Digital Marine Map

The highly efficient and intelligent digital marine map developed by the Chinese navy has recently passed experts verification checks. Integrated with words, images, voice and activated pictures, the said digital marine map is of many merits such as decision making capacity, large information volume, fast saving capacity, portable, and able to simulate marine reality. A single optic disk may contain a hundred marine maps. The user may have access to the data in a matter of a few seconds through radio telecommunication, retrieving, downloading and directly entering digital marine maps into the ship based automatic control system for automatic piloting. The said development is of important economic and defense values. 

       Comments or inquiries on editorial matters or Newsletter content should be directed to:Mr. Cheng Jiayi, Department of International Cooperation, MOST 15B, Fuxing Road Beijing 100862, PR China  Tel: (8610)68512650 Fax: (8610) 68512594                   http://www.most.gov.cn