Chinese minister says foreign automakers granted equal treatment

Foreign automakers doing business in China enjoy equal treatment with local car manufacturers, said a Chinese minister on Saturday, after Tesla Chief Executive Officer Elon Musk complained about the country's unfair industrial policy.

Chinese Minister of Science and Technology Wan Gang made the remarks on the sidelines of the annual meeting of the country's legislature, after Musk posted a series of tweets directed at US President Donald Trump criticizing China for adopting unfair auto trade policy.

China slaps a 25 percent tariff on cars imported from the United States, while the United States only places a 2.5 percent tariff on cars imported from China, Musk complained in the tweets.

"During my conversations with Musk, I did not hear any complaints about us," said Wan, adding that foreign new energy car producers doing business in China including General Motors, Ford and Volkswagen are given the same treatment with Chinese players after they establish joint venture companies with local partners.

In efforts to penetrate China's automobile market, Tesla has been in talks with the Chinese government for the feasibility of building a local manufacturing facility, a move that can help it reduce production cost and avoid hefty import tariff.

But recently, the US electric car maker faced hurdles in finalizing a deal with the government due to the latter's disagreement over the ownership structure of the proposed plant. Tesla wants its China plant to be self-owned as an exception to China's industry rules, which require that foreign automakers must establish 50-50 joint venture companies with local partners before making cars in the Chinese territory, media reports said, citing sources familiar with the situation.

In 2016, China's National Development and Reform Commission, the country's top economic planner, said that it was mulling the cancellation of the 50 percent shareholding limitation.

"We can have communication when problems occur. American entrepreneurs are welcome to invest in China. Besides electric cars, there will be a lot of things we can discuss," said Wan.

Wan noted that the introduction of foreign-made electric cars would enable Chinese consumers to enjoy diversified products and services.

There are reports saying that a major reason behind Musk's unwillingness to establish a joint venture in China is that he does not want Tesla's technologies to be shared by Chinese partners.

In response, Wan said that China and the United States do not raise barriers to cooperation on technological innovation, adding that a bilateral scientific and technological cooperation agreement which was signed in 1978 was still effective.

The energy departments of China and the United States run a joint research center, which delves into energy-saving architectures, and use of clean coal and electric cars, according to Wan.

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