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level. Low efficiency incurs relatively high costs to produce a unit of goods and high costs lowers the competitiveness of Chinese goods in global markets, eventually risking stable economic growth.
The government of China also recognized the danger of inefficient economic structure and tried to enhance its efficiency in industrial sectors by using diverse policy options. By and large, it relied on the five approaches: 1. inducing foreign direct investment and allowing quasi-free competitions with domestic firms; 2. buying foreign firms to acquire skills and technologies; 3. allowing minor equity ownership to foreign strategic investors; 4...
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