Vice-Minister of the Information Industry Gou Zhongwen Thursday promised a level playing field for foreign software firms over access to government contracts.

The vice-minister's pledge came as government officials and executives stressed that the best prospects for the software industry's future development will be achieved with its further opening up and more cooperation with foreign firms.

Gou said that a regulation on government software procurement will be issued soon, with foreign software companies investing in China also subject to the same regulation.

"Software firms invested by foreign companies will enjoy equal opportunities from government procurement," said Gou.

Earlier media reports had suggested that the government would prevent foreign firms -- such as Microsoft -- from gaining access to these lucrative contracts.

Domestic software firms are seeking fast growth through cooperation with foreign firms.

The northeastern coastal city of Dalian is aiming to increase these contacts by hosting the 2004 China International Software and Information Service Fair, the only national software exhibition in the country, running from July 28 to 31.

The city -- one of the nation's 10 software export bases -- will hold seminars between Chinese, Japanese and South Korean software organizations and companies to promote these exchanges.

In order to attract more foreign software firms to the area, Dalian is in talks with Singapore to construct a cooperation model on a par with the Sino-Singaporean Industrial Park in Suzhou in East China's Jiangsu Province.

Tang Min, chairwoman of the China National Computer Software and Technology Service Corp (CS&S), said cooperation with international giants like Microsoft can also provide a short cut for domestic software companies to gain more experience, and learn about advanced technology.

She said CS&S cooperation with Microsoft had provided a major boost to her company's technological development.

Microsoft will train 200 software developers and 100 software architects for the Chinese software company in one year, according to a recent agreement.

Increased international cooperation can also help cut the shortage of highly skilled staff, which the vice-minister regards as the greatest obstacle to its further development.

Dalian Mayor Xia Deren said his city would send a delegation to India to attract Indian software professionals, in order to ease Dalian's shortage of highly skilled software engineers.

HP China's vice-president Jack Shu also suggested Chinese software companies try to attract engineers from the United States, where people face fiercer competition and even risk losing their jobs, meaning that they will be eager to come and work in China.

Apart from attracting foreign software companies and professionals, domestic companies should gain a foothold in the global industrial chain and increase software exports.

China Software Industry Association Chairman Yang Tianxing said the shift of low-end software contracts to countries like China and India offered good opportunities for Chinese companies.

With the twin attractions of low labor costs and highly-skilled staff, China has become one of the most attractive destinations for software outsourcing projects.

Tang Min from CS&S said her company will develop its subsidiary in Dalian into a software outsourcing base.

US information technology giant Hewlett Packard will also set up its North Asia software development center and outsourcing center in the city.

(China Daily February 6, 2004)