Western Philanthropy Model Can Hardly Be Copied in China:Experts

Bill Gates and Warren Buffet, two of the world's richest men, will hold their philanthropy banquet for Chinese millionaires tonight in Beijing.

The Microsoft mogul has said he won't be lobbying Chinese billionaires to donate, and is only promoting the idea of philanthropy in the world's most populous country.

However experts say without well-established policies supporting charitable donations, the Western philanthropic mode can hardly be effective in China.

Yao Yongmei has more.
Liu Mingsheng is a council member from the Chinese Red Cross Foundation.

He says while the banquet may provide an opportunity for Chinese millionaires to share their experiences with the two American philanthropists, one single event isn't enough to establish a good philanthropy system in China.

He cites the example of Chen Guangbiao, one of the 50 Chinese entrepreneurs on the guest list, who announced he will donate all his wealth after he dies, matching the U.S. tycoons' pledge to donate half their own wealth.

Liu Mingsheng says, considering the different legal conditions, it's not practical to ask Chinese entrepreneurs to follow suit.

"The death tax in the U.S. now is about 50 percent, which means half of your wealth will be taken as taxes when you leave the world. This policy, to some extent, helps encourage many entrepreneurs in the U.S. to donate while alive. However we don't have such policy to encourage Chinese donators."

Agreeing with his point is Yu Shaoxiang, a law professor from the Chinese Academy of Social Sciences.

Yu says the current regulations on Chinese charitable foundation are not very strong, which muffles donors' enthusiasm.

"Most major Chinese foundations are backed by the government, which means they are both the receivers and the organizers of donations. However China now doesn't have a clear law supervising the use of donations, which lowers the credibility of Chinese foundations as a whole."

The current regulations on charitable foundations, enacted in 2004, divide China's philanthropic organizations into private and government-backed public foundations.

Professor Yu says the Western experience shows that private foundations can better promote philanthropic causes.

"Most philanthropic organizations in Western countries are private foundations. They not only receive donations but also have the legal right to further invest this money and put their gains into other charitable projects. However, in China, the current regulations strictly limit the register for private foundations and their use of donations, all of which hinders the development of philanthropic causes in China."

The professor adds that the current regulations do encourage public foundations in terms of tax deductions and further investment. However a supporting legal system is necessary to guarantee the transparency and efficiency of such investments.

For CRI, this is Yao Yongmei.