Sim­pli­fied mea­sures for in­vest­ment

China Daily (USA) - - POLICY REVIEW - By ZHANG YUE zhangyue@chi­nadaily.com.cn

The Chi­nese gov­ern­ment will fur­ther stream­line ap­proval pro­ce­dures for for­eign in­vest­ment across the coun­try to at­tract more over­seas in­vest­ment and im­prove China’s busi­ness en­vi­ron­ment.

A new leg­isla­tive guide­line was ap­proved dur­ing the State Coun­cil’s ex­ec­u­tive meet­ing on Oct 8, chaired by Premier Li Ke­qiang. “Our coun­try also needs ad­vanced tech­nol­ogy and new ideas to press ahead with devel­op­ment,” Li said. “This is part of the gov­ern­ment’s cru­cial ef­forts to stream­line ad­min­is­tra­tion and del­e­gate power, as well as im­prove our busi­ness en­vi­ron­ment.”

The new guide­line is a re­vi­sion of the ex­ist­ing ad­min­is­tra­tive mea­sures for for­eign in­vest­ment in China’s four free trade zones in Shang­hai, Guang­dong, Tian­jin and Fu­jian, turn­ing the three­year pi­lot mea­sures into a leg­isla­tive guide­line.

Ac­cord­ing to the new guide­line, those in­ter­ested in in­vest­ing in China no longer have to go through ap­proval pro­ce­dures if they in­vest in non-re­stricted sec­tors, in ac­cor­dance with the Cat­a­logue of In­dus­tries for For­eign In­vest­ment, and do not con­tra­dict the spe­cial re­quire­ments re­gard­ing eq­uity rights and level of man­age­ment in the cat­a­log, which was is­sued last year.

The new guide­line is aimed at help­ing for­eign in­vestors re­duce con­cerns about dis­crim­i­na­tory in­dus­trial poli­cies in China, and calls for more ef­fec­tive gov­ern­ment ser­vices for for­eign in­vest­ment.

The im­por­tance of en­cour­ag­ing for­eign in­vest­ment has been fre­quently stressed by Li, and was most re­cently brought up when he ad­dressed an au­di­ence in­NewYork last month.

“We are pay­ing equal at­ten­tion to ‘bring­ing in’ and ‘ go­ing global’, and for a de­vel­op­ing coun­try like China, it is still im­por­tant to at­tract mas­sive for­eign in­vest­ment, which can help boost the Chi­nese econ­omy,” Li said.

“We hope that China will re­main an at­trac­tive des­ti­na­tion for for­eign in­vest­ment. We need for­eign in­vest­ment for eco­nomic growth, and more im­por­tantly, we need new man­age­rial ex­per­tise and ad­vanced tech­nolo­gies that for­eign in­vest­ment brings,” he said.

The “for­eign in­vest­ment neg­a­tive list” was first ap­plied in the Shang­hai FTZ in 2013, the coun­try’s first FTZ. It ex­plored paths to bet­ter at­tract over­seas in­vestors by act­ing as a guide­line for tem­po­rary ad­min­is­tra­tive mea­sures for FTZ for­eign in­vest­ment reg­u­la­tions. For­eign in­vestors whose projects are not on the neg­a­tive list only need to register their in­vest­ment with the gov­ern­ment sys­tem via the in­ter­net.

This was later ap­plied to the other three FTZs, and was ex­pected to be re­vised and ap­plied across the coun­try af­ter a three-year trial.

Of­fi­cial data show that such mea­sures greatly boosted for­eign in­vest­ment in th­ese ar­eas. FromJan­uary to Au­gust, ac­tual use of for­eign cap­i­tal in the four FTZs to­taled $8.59 bil­lion, ac­count­ing for al­most 10 per­cent of the na­tional to­tal. A third-party eval­u­a­tion also shows the sim­pli­fied­mea­sure­shave brought vigor to for­eign in­vest­ment. On­line reg­is­tra­tion takes just three work­ing days, while the pre­vi­ous ap­proval pro­ce­dure usu­ally took no less than 20 work­ing days.

Once the newguide­line is put in place, ad­min­is­tra­tive pro­ce­dures re­quired for reg­is­tra­tion will be re­duced by 95 per­cent. The de­ci­sion to re­vise the reg­u­la­tions was ap­proved by the Stand­ing Com­mit­tee of the Na­tional Peo­ple’s Congress in early Septem­ber.

Ac­cord­ing to Wu Qing, a fi­nance re­searcher with the Devel­op­ment Re­search Cen­ter of the State Coun­cil, the change in in­vest­ment pro­ce­dure man­age­ment should send a pos­i­tive sig­nal to for­eign in­vestors about China’s im­prov­ing in­vest­ment en­vi­ron­ment.

YU CHUNHUA / FOR CHINA DAILY

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