China to break phone monopoly

China will break its government-run telecommunications monopoly into four companies to infuse competition into the $US28 billion telecomms sector, according to a report published yesterday.

China Telecom will be divided into separate companies offering fixed telephone service, mobile communications, paging and satellite communications, according to an Associated Press report citing China's Minister of Information Industry.

No time frame was given for the breakup, which is seen as a concession by China in its quest to join the World Trade Organization, according to the AP report. China may permit foreigners to take up to 30 per cent stakes in telecommunications companies, countering previous policy which essentially limited foreign participation to equipment sales, the report said.

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