Overview

Today's hearing will examine three aspects of China's economic policy. The first is China's state-owned or state-controlled companies and industries, which together constitute an estimated 30 to 40 percent of China's economy. These companies, generally the largest ones in China, are operated and managed by the central government of the People's Republic. They are an instrument of state power as well as the centerpiece of China's industrial policy. They receive massive government subsidies and are protected from competition from foreign companies. But, we also need to understand what other Chinese entities are doing - not a simple task. Beyond the state-owned or state-invested enterprises, there are companies that act under the direction of the state or with delegated authority. We need to understand the implications of their efforts. Two separate panels will examine U.S. direct investment in China and Chinese direct investment in the United States. Both forms of investment have been increasing, especially U.S. investment in China. As you will hear, more than half of the imports to the United States are from foreign invested enterprises in China.

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