Poli­cies to boost ac­cess for for­eign in­vest­ment

China Daily (Hong Kong) - - FRONT PAGE - By ZHONG NAN zhong­[email protected]­nadaily.com.cn

China will fur­ther cut re­stric­tions on for­eign in­vest­ment and ad­dress chal­lenges fac­ing for­eign com­pa­nies in­vest­ing in its mar­ket this year, the coun­try’s top com­merce of­fi­cial said.

The neg­a­tive list, which restricts for­eign in­vest­ment in cer­tain in­dus­tries, will be fur­ther short­ened in both its 12 pi­lot free trade zones and na­tion­wide, and al­low full for­eign own­er­ship in more sec­tors, Com­merce Min­is­ter Zhong Shan said in an in­ter­view with Xin­hua News Agency on Satur­day.

He specif­i­cally out­lined a push for for­eign in­vest­ment in man­u­fac­tur­ing and high-tech in­dus­tries and in cen­tral and western re­gions, adding that the gov­ern­ment will help for­eign com­pa­nies ad­dress dif­fi­cul­ties with in­vest­ing in China.

To build a fa­vor­able en­vi­ron­ment, the min­istry will push for a for­eign in­vest­ment law and im­prove gov­ern­ments’ han­dling of com­plaints from for­eign busi­nesses, Zhong said.

As a ma­jor global in­vest­ment desti­na­tion, China has main­tained stable growth in for­eign di­rect in­vest­ment against a gloomy global set­ting. Its FDI grew by 3 per­cent year-on-year to $135 bil­lion in 2018, while the fig­ures for the world as a whole and de­vel­oped coun­tries dropped 41 per­cent and 69 per­cent, re­spec­tively, in the first half of last year, said Zhong.

The World Bank raised China’s rank­ing in terms of busi­ness en­vi­ron­ment by 32 places. Also, 95 per­cent of com­pa­nies sur­veyed by the Wash­ing­ton-based US-China Busi­ness Coun­cil said they would in­crease in­vest­ment or main­tain their ex­ist­ing pres­ence in China in the com­ing year, ac­cord­ing to a re­port re­leased in De­cem­ber.

“The Chi­nese mar­ket has huge po­ten­tial and sound prospects,” Zhong said. The coun­try’s goods con­sump­tion, which is ex­pected to achieve 9.1 per­cent an­nual growth in 2018 to 38 tril­lion yuan ($5.6 tril­lion), has served as the big­gest growth driver for five con­sec­u­tive years.

Ea­ger to en­large their mar­ket share, a num­ber of multi­na­tion­als such as Ger­man au­tomaker BMW AG and Exxon-Mo­bil Corp of the United States an­nounced big-ticket in­vest­ment plans in China last year. This comes as China steadily marches to­ward be­com­ing the largest coun­try in con­sump­tion of goods and ser­vices.

Cal­i­for­nia-based Tesla Inc broke new ground as con­struc­tion started on its Shang­hai plant on Jan 7. It be­came the first com­pany to ben­e­fit from a new pol­icy al­low­ing for­eign car­mak­ers to start set­ting up wholly owned sub­sidiaries in China. It is also the city’s big­gest for­eign in­vest­ment in man­u­fac­tur­ing at $7.3 bil­lion.

BASF SE, the Ger­man chem­i­cal gi­ant, also signed an agree­ment with Guang­dong prov­ince last week to fur­ther clar­ify de­tails of its $10 bil­lion Ver­bund chem­i­cal com­plex in Zhan­jiang.

Zhong said the min­istry will fur­ther stim­u­late do­mes­tic con­sump­tion this year, with mea­sures to fa­cil­i­tate ur­ban con­sump­tion up­grades, tap into the po­ten­tial of ru­ral ar­eas, build mod­ern sup­ply chains and sup­port use of ser­vices.

He said the three ma­jor tasks of the Min­istry of Com­merce this year will be hold­ing the sec­ond China In­ter­na­tional Im­port Expo, prop­erly han­dling trade fric­tions with the US and push­ing for­ward pi­lot FTZs and the Hainan free trade port.

These are prac­ti­cal moves in build­ing a pre­dictable and trans­par­ent busi­ness en­vi­ron­ment for global in­vestors, to en­sure that they are given fair mar­ket treat­ment, said Zhang Yan­sheng, a re­searcher at the China Cen­ter for In­ter­na­tional Eco­nomic Ex­changes.

“The Min­istry of Com­merce is cur­rently plan­ning to add new ar­eas for the China (Shang­hai) Pi­lot Free Trade Zone and de­sign poli­cies for build­ing the Hainan free trade port to pro­mote their growth,” said Tang Wen­hong, di­rec­tor-gen­eral of the min­istry’s depart­ment of for­eign in­vest­ment ad­min­is­tra­tion.

Zhong Shan

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