More foreign investment encouraged

Authorities release revised list in hope to enhance resilience in modern services

China is enlarging the scope of investment by foreigners with a revised catalog of industries, a fresh sign of opening-up and high quality development resolve.

The National Development and Reform Commission and the Ministry of Commerce released a revised 2020 catalog of industries on Monday in which foreign investment is encouraged.

The new edition, which is set to be effective Jan 27, has added 127 items from last year’s version for a total of 1,235 items to be implemented nationwide. A secondary catalog will be specifically applicable to the central and western regions.

The latest edition also favors foreign investment in advanced manufacturing to enhance resilience in industrial and supply chains and in modern services to boost quality in the sector, according to a statement by the Ministry of Commerce on Monday.

Newly added and revised listings of industries include 5G, blockchain, maintenance of high-end equipment, online education and online health services.

Shanghai authorities also pledged on the same day to open up a host of financial services and service trade areas as it seeks higher quality development. The city has the highest number of multinational corporations’ regional headquarters on the Chinese mainland.

The city is expected to attract more than $20 billion in foreign investment this year, which local authorities said would “hit a historical high” on a yearly basis.

Shanghai will embrace international agreements like the Regional Comprehensive Economic Partnership, said Hua Yuan, director of Shanghai Municipal Commission of Commerce. It is also eyeing benchmark initiatives like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership for more advanced opening-up.

“China’s signing of RCEP and the targeting of CPTPP spell great opportunities for Shanghai to further open up the service sector,” said Hua at a news briefing. “We will make the most of such international rules on investment and trade to advance the service sector.”

Specifically, the city will prioritize opening-up in seven financial fields such as banking, securities and insurance. It will also advance opening-up in an orderly fashion in six areas including telecom, internet and healthcare.

Hua said the city will conduct trials using a large number of pilot zones such as the China (Shanghai) Pilot Free Trade Zone and Lingang Special Area, the Shanghai Hongqiao Central Business District and the demonstration zone of the Yangtze River Delta.

Cheng Jie, chief financial officer of German chemical company Covestro in China, said the company feels at home in Shanghai. “China is the single largest market for Covestro and we regard Shanghai as our home,” Cheng said. The company upgraded its regional headquarters in the Shanghai FTZ to add new functions like R&D and investment this year.

“That’s especially true against the backdrop of COVID-19, during which China has become the first market to recover and the key contributor to our group business,” she said. “Our success is not possible without the great support from the Shanghai municipal government in opening-up and the improving business environment.”

China’s use of foreign capital rose by 5.5 percent year-on-year to 98.7 billion yuan ($15.09 billion) in November, the eighth consecutive month of positive FDI growth, according to the Ministry of Commerce.

“Under the wave of digitization and new infrastructure, Honeywell aims to better meet the needs of China’s industries and consumers,” said Zhang Yufeng, president of Honeywell China. “We will seize market opportunities, strengthen local innovation and cooperation, and contribute to the high quality development of China’s economy while sharing development dividends.”