China eases investment rules in free trade zones

The Chinese government has decided to ease investment rules in four free trade zones (FTZs), temporarily allowing foreign investors to found wholly-owned enterprises in a number of fields, including iron and steel production and gas station operations, according to the central government website on Tuesday.

The resolution on temporary adjustment of regulations for administrative approvals in the Shanghai, Guangdong, Tianjin and Fujian FTZs was passed by the National People's Congress Standing Committee, it said. The adjustment contains a total of 51 items, with more than 20 of them involving changes from administrative approval to managerial registration for foreign investment.

It also approved wholly foreign owned enterprises in dozens of areas outside of the negative list on foreign invest- ment, covering sectors ranging from agriculture to transportation.

Meanwhile, bilateral trade between China and ASEAN has boomed during the past 25 years, but declines were reported this year because of the febrile global economy, a senior official said Tuesday. Bilateral trade between China and ASEAN rose to $472.16 billion in 2015 from $7.96 billion in 1991, with an annual growth rate of 18.5 percent, Vice Commerce Minister Gao Yan said at a news conference. During the Jan-May period, bilateral trade fell 7.1 percent year on year to $173.57 billion.

The two sides are trying their best to "get bilateral-trade growth back on track as soon as possible", Gao said. China currently is ASEAN's biggest trading partner, while ASEAN is China's third biggest.

By the end of May, two-way investment had exceeded $160 billion, with ASEAN remaining a major destination for Chinese companies.

Moreover, growth in domestic housing prices and property investment is expected to slow from the second half of 2016 to the second quarter of 2017, according to a report jointly released by the National Academy of Economic Strategy and Center for City and Competitiveness, two Chinese Academy of Social Sciences research groups.

As the property market warms up from the second half of 2015, the year-onyear growth rate of "total commercial housing sales area" turned positive from June, with housing prices continuing to climb. Since early this year, the rate of year-on-year growth in property investment has picked up. Its contribution rate to the gross domestic product (GDP) growth also reached 0.37 percent in the first half of this year. In addition, compared to 2015, the first half of 2016 saw housing stock drop approximately 50 million square meters and the number of cities with rising housing prices increase.

Ni Pengfei, chief editor of the Annual Report on the Development of the Housing Market in China, said the recovery of the property market, which was reflected in prices rises, investment and de-stocking rate, was due to policy stimulation and changes in market expectation.

As for the excessive growth of housing prices in first-tier and some hot cities, central and local governments have adjusted some regulatory and control measures to cool down the overheating markets and make them achieve "soft landing", he said.

"A few cities overheat, while most cool down"- this kind of market differentiation is expected to further intensify, the report said.

Yin Zhongli, a researcher at the Institute of Finance and Banking at the Chinese Academy of Social Sciences, said changes in Shenzhen's housing price epitomized the trend of property market differentiation in China.