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China should approve wholly foreign-owned life insurers

By Shangguan Zhoudong (chinadaily.com.cn)
Updated: 2006-12-01 14:35

Related publication: Related readings: Rural life insurance rules to be tightened More foreign insurance giants invest in China Foreign insurance firms fall short on tax

Hao Yansu, Director of the Insurance Department of the Central University of Finance and Economics, said China should approve the establishment of wholly foreign-owned life insurers.

According to China's commitments to the World Trade Organization (WTO), foreign life insurers will be permitted a 50-percent foreign ownership in a joint venture with a partner of their choice, but the policy has resulted in internal losses due to corporate governance problems and unfair competition.

"The original ideas that we would learn from joint ventures hasn't happened. Most of them are 50-50 joint ventures, and foreign insurance companies won't bring all their skills into play to export capital and experience to Chinese market, so China can't learn the essentials from foreign partners," Hao said during a Reuters interview.

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The full text is available in the December Issue ofChina Insurance.