China's rejection of Coca-Cola's bid to buy the country's top juice maker, Huiyuan, marked no retreat from government policies welcoming foreign investment, the government said on Thursday.

This has nothing to do with trade protectionism....This decision was made for the sake of market competition, Qin said of the Ministry of Commerce's decision to block the purchase on the grounds that it would be damaging to consumers' interests and open competition.

Qin's comments suggested that as Beijing prepares to join the G20 summit of rich and developing major economies in London next month, it will reject claims that the decision shows it is no adherent of open markets.

A statement by the Ministry of Commerce also sought to deflect accusations of protectionism.

The Ministry of Commerce's decision to block the acquisition was neither affected by disturbing external factors and nor was it protectionism, the ministry's spokesman, Yao Jian, was quoted by Xinhua as saying. The decision in the case has nothing to do with China's policies about foreign capital.

Huiyuan controls more than a tenth of a Chinese fruit and vegetable juice market, which grew 15 percent last year to $2 billion. Coca-Cola has a 9.7 percent market share.

The ruling has fanned comment among some industry analysts and trade lawyers that China will use its anti-monopoly law to fend off foreign attempts to buy promising domestic firms, even when the resulting market concentration would not be excessive.

But Qin brandished bottled water on his podium from what he said was a Swiss-based company to argue that his country remains fully open to foreign brands and investors.

We will continue a policy of opening up and welcoming foreign capital, he said.

Especially in the current financial crisis, China's leaders have said many times that all countries should oppose trade and investment protectionism and this stance has not changed.

(Reporting by Chris Buckley; editing by Ken Wills)

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