Joint Ventures in the People's Republic of China.

In the 1980s, a rapid economic growth became a paramount goal of the People's Republic of China. The Communist government in the mainland China instituted economic reforms by encouraging free enterprises and competition, adopting a market-oriented economy, and increasing productivity. In order to attract foreign capital and investment, the Beijing government established a system of joint ventures to allow foreign companies to form partnerships with Chinese companies for a variety of business and production activities in China. It was intended to induce foreign investments, through these joint ventures, to supplement the traditional way of raising foreign capital through commercial, industrial, and governmental borrowings from foreign banks and international agencies.

This book is divided into six chapters, each covering a different aspect of undertaking joint ventures in China. Chapter 1, "The Emergence of Joint Venture Enterprises," traces how the joint ventures system emerged as a part of the economic reforms and what guidelines were established to make the joint ventures beneficial to both sides. Chapter 2, "The Legal Basis for Joint Ventures," describes the ways the government translated the ideas and policies into national and local legislation to provide a legal basis for joint ventures. In essence, laws dealing with joint ventures were enacted by the legislature, regulations were set down by the central government, and rules and procedures were spelled out by the local governments. Chapter 3 "The Organization and Operation of Joint Ventures," covers the procedure for establishing a joint venture, from finding a suitable Chinese company, gaining approval of the government, hiring and firing workers, producing and marketing the products, and sharing the profits to eventually dissolving the partnership.

Chapter 4, "The Development of Joint Ventures," examines the experience of joint ventures in China from 1979 to 1987, including the growth of joint ventures, the sources of foreign direct investments, and the impact of joint ventures on the Chinese economy. In chapter 5, "The Tianamnen Square Incident and Its Aftermath," the author describes the incident and assesses the effect of the shift in government policy, that followed the upheaval, on China's economy and trade. Chapter 6, "Observations and Suggestions Regarding Joint Ventures," provides some observations on the favorable environment for foreign investment in China and the impact of joint ventures on the Chinese economy.

Professor Ho used both Chinese and English language publications for this book. It was evident throughout this book that he made good use of his bilingual ability in gathering and analyzing the data and material written in Chinese. For example, the English translation of the laws on joint ventures is included in the appendix section. Appendix 1 covers "The Law of the People's Republic of China on Joint Ventures Using Chinese and Foreign Investments, July 1, 1979". Another appendix deals with "Regulations Governing the Implementation of the Law of People's Republic of China on Joint Ventures, September 20, 1983".

Students of international trade and finance, development economics, and the Chinese economy will find this slim volume to be an important reference source for their studies. International businessmen will also find this book useful in evaluating investment opportunities in China. Especially, the experience with, and the lessons to be learned from, the joint ventures described in this timely study will be valuable to foreign firms planning to enter into joint ventures in China.