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Beijing Says 'Buy China' Directive Not Protectionist

China is defending its so-called "Buy China" directive that gives Chinese companies first, and nearly exclusive, priority in winning contracts under the country's nearly $600 billion stimulus program.

When the U.S. government debated adding a "Buy American" requirement to its stimulus bill, China protested loudly. Chinese officials called the move toxic and protectionist.

China is now moving ahead with its own efforts to ensure that its stimulus package benefits Chinese companies.

Buy domestic

An order dated June 1 and reported by Chinese media this week says government investment projects should buy domestically-made products, unless these products or services cannot be obtained within China. It also says that purchases of imports need to be approved by relevant government departments, before the purchases are made.

At a regular news briefing Thursday, Chinese Foreign Ministry spokesman Qin Gang said the "Buy China" directive is not protectionist.

Qin says the purpose of the regulation is to maintain what he describes as a "fair-market environment for competition."

Not meant to discriminate

He says the requirement is in line with Chinese law on government procurement.

Qin says the law is not meant to discriminate against foreign enterprises or products.

Earlier this year, China's communist government had promised to treat foreign and domestic goods equally in stimulus spending. It also appealed to other governments to support free trade and avoid protectionism.