China plans to speed up reforms in FTZs

CHINA yesterday rolled out plans to deepen reform of pilot free trade zones in Tianjin as well as the provinces of Guangdong and Fujian.

“A better business environment that is law-based, international and accommodating will take shape in the pilot FTZs, while they will be granted bigger decisionmaking power in reforms to help make new ground in pursuing opening-up on all fronts, improve government management, and foster new growth drivers and competitiveness,” according to a State Council document.

China now has 11 pilot FTZs, covering both coastal and inland regions. The country started piloting FTZ in 2013 in the financial hub of Shanghai.

In 2015, China added pilot zones in Tianjin, Guangdong and Fujian, and then in Liaoning, Zhejiang, Henan, Hubei, Sichuan and Shaanxi provinces as well as Chongqing in 2017.

In April, China announced plans to support the country’s southernmost province Hainan to be developed into a pilot FTZ, and gradually become a free trade port as the country marks the 40th anniversary of its reform and opening-up drive.

The FTZs have become pioneers of the country’s reform and opening-up as they test new styles of foreign investment management, trade facilitation and transformation of government functions to better integrate the economy with international practices.

Trade usually booms in such regions.

The Shanghai pilot FTZ saw its 2017 trade volume reach 1.35 trillion yuan (US$212 billion), up over 14 percent year on year, accounting for about 42 percent of Shanghai’s total trade volume last year.

Foreign investment is also boosted with the use of shrinking negative lists, which outline economic areas restricted for foreign investment.

The negative list covered about 190 items in 2013, but was trimmed to 122 in 2015 and to 95 in 2017.

Revisions of national and pilot FTZs negative lists are ongoing to reduce market barriers to foreign investment, according to the Ministry of Commerce.

The State Council announced on Wednesday that 30 practices applied in the existing FTZs will be adopted by local governments and specific areas, making 153 shared practices so far.

Practices to be shared nationwide include expanding the transport area of international ships, offering online registration for general taxpayers, facilitating inspection and quarantine for empty ocean-cargo containers and sharing business information.