Although China's foreign trade expands fast, export increment has been heavily depended on foreign-funded companies, said an official with the General Administration of Customs (GAC) here Friday.

Zhang Lichuan, director of the Statistical Division of the GAC, said this at the three-day International Forum on Productivity Development in China.

According to the GAC's figures, trade volume of foreign-funded companies in the first nine months this year grew 24.8 percent, 1.1 percentage points more than the growth of overall trade volume, accounting for 57.6 percent of the total.

Foreign-funded companies enjoyed a trade surplus of 31.89 billion US dollars, 87 times more than that of the same period of 2004.

Foreign-funded companies enjoy favorable policies in taxation, industrial policy and land usage in China.

Discriminating policy has chronically depressed the development of domestic companies, Zhang said.

In the past ten years, the shares of foreign-funded companies in exports has been rising continuously.

In 2004, the export of foreign-funded companies accounted for 57.1 percent of total export, up 9.2 percentage points from 2000, the GAC statistics show.

"The benefit of export by foreign-funded companies is only salary of employees and cost of raw materials, while environmental pollution is left," she said. "The actual benefit of trade for China is fairly limited."

According to statistics from China's Association of Entrepreneurs, China has more than 557,600 foreign-funded companies by the end of the third quarter of 2005, with an actual investment of more than 600 billion US dollars.

Source: Xinhua