China's NDRC calls for private telecom investment

27 May 2009

China\'s top economic planning body has called for telecoms and other government monopolies to be opened up to private investment.

In guidelines for industry reform, the National Development and Reform Commission (NDRC) said it hoped to encourage private investment into telecoms, oil, power, rail and other monopoly areas to boost economic growth.

In a document issued by the State Council, China\'s cabinet, the NDRC said it "was hopeful" that the introduction of measures to encourage private investment to enter telecoms would be accelerated.

It said it expected "realistic progress" from the convergence of telecoms, internet and cable.

Currently investment in basic telecom services and infrastructure in China is confined to three state-controlled carriers. While under WTO rules China has promised to allow foreign companies to own up to 49% of mainland cellular companies, none has so far been permitted.

The NDRC document appears to be aimed at breaking the logjam between the cable and telecom industries.

China is one of the few major economies where telecom carriers are forbidden from offering TV services and cable companies cannot carry voice calls. The two regulators - the MIIT for telecoms and SARFT for cable - have been stalemated for years on an agreement about opening up their sectors.

The commission urged the implementation of regulations to allow the telecom and cable industries to invest in each other and to promote the promote progress towards convergence.

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