China Tests “Neg­a­tive List” Ap­proach in Four Re­gions

China's Foreign Trade (English) - - Briefing -

A “negat ive list ” ap­proach, which iden­ti­fies sec­tors and busi­nesses that are of­flim­its or re­stricted for in­vest­ment, has been tested in four re­gions, in­clud­ing Tian­jin, Shang­hai, Fu­jian and Guang­dong, au­thor­i­ties an­nounced re­cently.

China’s top eco­nomic plan­ner, the

Na­tional De­vel­op­ment and Re­form Com­mis­sion, said it has handed out the draft plan on the ap­proach to the above­men­tioned four ar­eas, which spec­i­fied 96 items that are off- limits and 233 items that are re­stricted for in­vest­ment.

The pi­lot is a ma­jor step to­wards gov­ern­ment aim to ex­plore a sys­tem that could be repli­cated na­tion­wide for ap­pli­ca­tion in 2018 as part of ef­forts to stream­line gov­ern­ment ad­min­is­tra­tion and give more free­dom to the mar­ket.

The “neg­a­tive list” ap­proach is a com­mon prac­tice adopted in many coun­tries to man­age for­eign in­vest­ment. China first pi­loted the rules in the Shang­hai Free Trade Zone in 2013.

By ex­tend­ing the ap­proach to cover do­mes­tic busi­nesses, China looks to re­duce the thresh­old for in­vest­ment and busi­ness start-ups to bring out the po­ten­tial of var­i­ous mar­ket en­ti­ties as the econ­omy slows.

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