Attracting funds soundly

That a former official has filed a case against the local government for which he worked, alleging it owes him more than 1 million yuan ($157,800) in commission for the projects he introduced, should prompt nationwide reflection on the policies used to attract outside investment, which most of the time involve the promise of tempting commissions.

On Saturday, a court in Haian county, East China's Jiangsu province, heard the lawsuit submitted by Liu Zheng, a former deputy chief of the investment promotion bureau, in which he asked the government to hand over the commission on two projects he introduced, one of which invested 150 million yuan and the other 1.08 billion yuan in the county's economic development zone. Liu's claim is based on documents issued by the zone's management committee in 2011 that he would be awarded 100,000 yuan if he successfully introduced investment of more than 100 million yuan and awarded 1 million yuan for an investment of more than 1 billion yuan.

The court's ruling is yet to be made, but the case should prompt deliberation on the use of policies, such as preferential land and tax incentives and promises of commission for those who broker investment deals.

When many regions in the country thirsted for funds for local development in the past, the use of all available means to encourage non-local investment did contribute to local economic development and employment. However, such efforts to attract investment also brought a range of problems, including the overuse of resources, low efficiency, environmental pollution and even corruption.

Investment activities should be a kind of market behavior free from the intervention of local governments. With a healthy economic and policy environment, outside investment will come. The commission dispute in Haian should be a reminder that at a time when the country is bidding to build a high-quality economic model, any unprincipled government campaign to attract outside investment should be brought to an end.