Firms need buying autonomy
(China Daily)
Updated: 2004-03-30 00:47

For a private business in this city, it can take more than a month to get government approval to purchase a car.

Private companies have to go through a set of procedures set down for State-owned enterprises that can lead them to purchase more items than they actually need.

The rules are a holdover from the old days of a planned economy, and a roadblock to general economic development, as well as the much-vaunted growth of the burgeoning automobile sector.

However, Chinese People's Political Consultative Conference (CPPCC) members here have suggested the local government grant waivers to private businesses to avoid the tiresome rules.

They have found that many private businesses circumvented the process by buying cars in the name of a person instead of the businesses.

The procedures had been set up originally for State-owned enterprises who used public money that needs to be carefully monitored and controlled.

"It is a good move for those private companies to be able to buy cars as easily as individuals can," said Ling Shufa, a CPPCC member in Guangzhou.

Ling has submitted a proposal to the on-going second session of the 10th CPPCC in Guangzhou, saying the idea is based on current difficulties such as having to apply for licence plates private companies encounter when they are restricted by the current regulations.

"Under the procedures, it's not until 10 days have passed or even more than a month before the private companies can obtain the licence plates," said Ling.

"Unquestionably, the procedure delays time and brings about lots of difficulties for private companies," he added.

"To avoid the difficulty, we bought a car for our company last year under my name instead of the company's," said Peng Ming, general director of Ming Tai Long Co Ltd, a private company in the city.

Ling points out that the application procedure was rooted under the old system of a planned economy.

"I am puzzled why the procedure is still going on today, since the funds private companies use to buy cars have nothing to do with the State assets," he said.

Ling said that dropping the application procedure will help reduce the government's burdens and help promote private companies' development.

Other members indicate that since the local governments are doing all they can to promote the auto sector, the new rules make sense.

It is estimated that there are over 25,000 private companies in the city at present, and nearly all are potential car buyers.

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