China's Ministry of Commerce (MOC) Thursday denied its refusal to approve Coca-Cola's acquisition of Huiyuan Juice Group was protectionist.
MOC spokesman Yao Jian said the decision would have no effect on China's policy in accepting foreign investment.
Yao said the ministry made the decision based "on sufficient investigation and research, on the basis of facts, and strictly in line with the country's anti-monopoly law."
He said countries worldwide commonly reviewed acquisitions under anti-monopoly laws, and China was no exception.
"The purpose of the examination is to maintain market competition, protect consumers and safeguard the public interest," he said.
The government would continue to accept foreign investment, enhance opening up and provide foreign investors with a good investment environment.
Foreign Ministry spokesman Qin Gang echoed Yao's comments, saying the rejection of the bid was in no way protectionism.
"Products of the Coca-Cola company are available anywhere in China's market. The country's market is fully open to foreign companies," said Qin.
Mei Xinyu, a trade expert with the MOC, said the rejection didn't indicate that the country had closed the door to foreign investment, neither did it equal protectionism.
Coca-Cola offered to buy Huiyuan, the nation's largest juice maker, for 17.92 billion Kong Kong dollars (2.3 billion U.S. dollars) in cash on Sept. 3. The MOC announced on Wednesday that the bid failed to meet requirements set out in the anti-monopoly law.
Hours after the decision was announced, Coca-Cola Company and Huiyuan said that they respected the decision.
Galaxy Securities analyst Zuo Xiaolei said the failed acquisition would not have any "substantial effect" on Huiyuan, because the company's domestic market had not changed.
Wang Zhile, a researcher with the MOC, said the failed bid might have a short-term negative effect on Huiyuan but the company would still play an important role in the country's pure juice market.
"However, the company should reconsider its development in the domestic market, so that it will grow better in the long run," he said.
(Xinhua News Agency March 19, 2009)
