The business environment in China worsened in 2010, compared with that in 2008, a survey conducted by a research institute showed.

The business environment in China worsened in 2010, compared with that in 2008, a survey conducted by a research institute showed.

Five among seven categories defining the business environment scored fewer points from those in 2008, Fan Gang, a renowned economist and also head of the National Economic Research Institute, told a business forum Tuesday, citing the survey.

The survey has traced more than 6,000 companies nationwide for more than a decade. Among the respondents, 49 percent are small companies, and over 41 percent are medium-sized companies.

The score on “infrastructure” decreased the most from 3.57 in 2008 to 3.19 in 2010, according the survey.

Most of the surveyed points to the “legal environment for business operations” as the worst, with a score of 3.1 in 2010, compared with 3.24 in 2008.

In addition, other three categories including “supplies of human resources”, “financial services” and “government’s administrative management” saw slight declines in socres disproportionally.

Business environments in five Chinese cities—Shanghai, Jiangsu, Tinjin, Zhejiang and Beijing are credited as the most favorable for companies in 2010, the survey showed.

However, in the vast middle and western part of China, companies in most of the provinces were enjoying a tougher environment with few improvements in 2010 except for those in the municipality city of Chongqing.

Based on the survey, Mr. Fan urged governments to relax policy controls to boost companies’ competitiveness.

Local governments should “reduce intervention (in companies’ business operations) and improve services”, Mr. Fan told the forum.

Source:caijing