April 16, 2015 / 8:17 AM / 5 years ago

UPDATE 1-Free, open Internet essential, US commerce secretary tells China

(Adds Chinese foreign ministry comment)

SHANGHAI, April 16 (Reuters) - An open and free Internet is essential in the 21st century, U.S. Commerce Secretary Penny Pritzker told Chinese officials on Thursday, urging them to ensure that government functions as an enabler of entrepreneurship, rather than a barrier.

Pritzker is leading a three-city trade mission to China, focused largely on green industries, to boost business links despite friction over issues including high-tech exports and cybersecurity regulations.

“We work to expand access to broadband and to protect a free and open Internet, which is absolutely a necessity for any firm in the 21st century, for them to be successful,” Pritzker said at the China Executive Leadership Academy Pudong, a state-run training school for up-and-coming Communist leaders.

The audience comprised about 60 mid-level officials from state-owned banks, brokerages, companies or other bodies on a short-term training course at CELAP’s 10-year-old campus, focused on deepening financial reforms.

“You have a very important role to play, to ensure that government is working as a catalyst and enabler rather than a barrier to entrepreneurship,” Pritzker said.

Despite efforts to encourage and assist start-ups, the Chinese government has struggled to provide a genuinely supportive environment, venture capitalists and other investors say. Intellectual property protection, policies to promote competition and access to capital have been chronic problems.

The government also aggressively censors the internet. Business groups, including the American Chamber of Commerce in Shanghai, have reported frustration among executives over the inaccessibility of many websites and slow internet speeds.

Chinese Foreign Ministry spokesman Hong Lei said that China’s Internet was free, open and “orderly”, with successful Internet companies including search engine Baidu Inc and e-commerce firm Alibaba Group Holding.

“China’s Internet provides a vigorous force for the development of the country’s economy and society,” he told a daily news briefing.

“At the same time, China is a sovereign nation and it’s an extremely reasonable thing to manage the Internet. It is to maintain the legal rights of people and companies.” (Reporting by John Ruwitch; Additional reporting by Ben Blanchard in BEIJING; Editing by Clarence Fernandez)

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