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. Last Updated: 07/27/2016

New Controls on Media in China Give Xinhua a Boost

SHANGHAI, China -- Xinhua News Agency, long a mouthpiece for China's Communist Party, is getting a boost from the Beijing government in its quest to become an international media power.

New rules that Xinhua issued Sunday in the name of China's Cabinet appear designed to shut out foreign news agencies such as The Associated Press and Reuters that have been seeking wider access to the fast-growing Chinese market.

The regulations give Xinhua a virtual monopoly over the distribution inside China of news, information and other services from foreign agencies, and come as the government has clamped down on mainstream media and the Internet, firing and even arresting aggressive reporters and editors.

But business, not politics, are driving the new rules, industry executives said.

"The problem is Xinhua needs money... [Xinhua] is not rolling in money, and they're looking for ways to get rich, to make Xinhua a player," said James McGregor, chairman of investment and consultancy company JL McGregor & Co.

Founded 75 years ago as the Red China News Agency, Xinhua already has a near lock on the domestic distribution of news to the media. But it has recently been struggling to remake itself into a modern, profitable news organization.