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New UN chief at Davos seeks allies in business
by Staff Writers
Davos, Switzerland (AFP) Jan 19, 2017


China to curb foreign investment by state-owned firms
Shanghai (AFP) Jan 19, 2017 - China said it will ban or closely monitor overseas investments by state-owned firms in certain sectors, the latest move in a government fight to stem capital flight and what it has called "irrational" spending abroad.

The state-assets watchdog, which manages the country's 102 state-owned giants, plans to draw up a list of sectors that will either be off-limits to investment by SOEs or under strict supervision, according to a government statement Wednesday.

The notice by the State-Owned Assets Supervision and Administration Commission gave no details on what sectors would be singled out, nor any timing.

But the state-run China Daily reported Thursday that the list would include heavily polluting industries or those vulnerable to global commodity price fluctuations, such as business related to energy, mining, real estate and the oil sector.

It quoted the commission's vice-chairwoman Huang Danhua as saying the government would, however, seek to encourage SOE overseas investment in sectors including high-speed rail, roads, telecommunications, and nuclear power.

Overseas direct investment surged 44 percent to 1.13 trillion yuan (now $165 billion) in 2016, surpassing inward investment of 813.2 billion yuan, according to the government, as Chinese companies went on a worldwide spending spree across a range of sectors.

In one of the largest moves, ChemChina made a $43 billion bid for Swiss seed giant Syngenta that is awaiting approval by EU regulators.

The tide of outgoing investment has alarmed authorities, who are grappling with slowing domestic economic growth, capital flight, and the weakening yuan, which is close to eight-year lows against the dollar.

Chinese authorities have responded by urging domestic companies to avoid "irrational" overseas investments and tightening screening of such plans while also announcing a number of measures aimed at attracting more foreign investment into China.

UN Secretary-General Antonio Guterres used his first address at the World Economic Forum in Davos on Thursday to push for a new partnership with business to help fight climate change and reduce poverty.

Guterres took over from Ban Ki-moon on January 1 with an ambitious plan to reform the United Nations at a time when it is struggling to raise funds for its humanitarian work and to address global crises.

The UN chief singled out business as the "best allies" to shield the Paris climate deal from "the possibility of less supportive action of some governments", in a veiled reference to US President-elect Donald Trump.

Trump, who takes office on Friday, has expressed skepticism about climate change, raising fears that he will withdraw the United States from the Paris deal on combating global warming.

"I would say that the best allies of all those who want to make sure that the Paris agreements are implemented, the best allies today in the world are probably in the business sector and it is very important to fully mobilize them," Guterres said.

Businesses are leading the way by investing heavily in the new green economy, he argued, putting their money behind the Paris agreement's goal of moving the world away from fossil fuels.

The former Portuguese prime minister, who lead the UN refugee agency for a decade, described an "alignment" between business and the "strategic goals of the international community."

The United Nations is pushing a new development agenda that calls for the end of extreme poverty by 2030, along with improving education, health and the environment worldwide.

The so-called Agenda 2030, however, will require trillions of dollars in investments from governments, aid donors and businesses.

In his pitch for private sector support, Guterres said that implementing Agenda 2030 could generate 30 billion dollars per year in returns on investment.

"I believe that there is now an opportunity for a new platform of partnership, at a higher level," he told the gathering of the world's elite.

This partnership could help the United Nations push its new development agenda and address challenges in the future, he said.

Guterres cited genetic engineering, artificial intelligence and cyber-space as examples, arguing that cooperation with business could "allow for a fantastic increase in the well-being of people".


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