Prag­matic changes set to bol­ster open­ing-up

China Daily - - FRONT PAGE - By ZHOU LANXU [email protected]­

China has made prag­matic plans to ful­fill its lat­est open­ing-up com­mit­ments, fur­ther lev­el­ing the play­ing field for for­eign busi­ness and in­creas­ing the na­tion’s ap­peal to global in­vestors, ex­perts said on Fri­day.

The re­ac­tion came af­ter the State Coun­cil, China’s Cabi­net, re­leased a guide­line on im­prov­ing the uti­liza­tion of for­eign in­vest­ment on Thurs­day. It rolled out 20 sets of pol­icy mea­sures with a fo­cus on safe­guard­ing an “open, trans­par­ent and pre­dictable” busi­ness en­vi­ron­ment.

The guide­line dis­trib­utes pol­icy tasks to mul­ti­ple lev­els, from min­istry-level in­sti­tu­tions to pro­vin­cial govern­ments.

“The guide­line serves as a prag­matic and ef­fec­tive move by China to en­sure that its high-level open­ing-up mea­sures are put into place, order­ing govern­ment de­part­ments to in­te­grate openingup tasks into ev­ery­day work,” said Zhang Xiao­tao, dean of the School of In­ter­na­tional Eco­nom­ics and Trade at the Cen­tral Uni­ver­sity of Fi­nance and Eco­nom­ics.

The guide­line not only out­lines mea­sures to fur­ther broaden mar­ket ac­cess for for­eign busi­ness, but also un­der­scores moves to op­ti­mize the busi­ness en­vi­ron­ment, which can “make im­proved in­sti­tu­tional ar­range­ments a new ad­van­tage for the Chi­nese econ­omy,” Zhang said.

The fi­nan­cial sec­tor is set to be a high­light in the broad­en­ing of mar­ket ac­cess, as the guide­line an­nounces re­moval of all re­stric­tions on busi­ness scope for for­eign-in­vested banks, se­cu­ri­ties firms and fund man­age­ment com­pa­nies, fol­low­ing the na­tion’s de­ci­sion to al­low full for­eign own­er­ship of the lat­ter two such in­sti­tu­tions by next year.

The open­ing-up of other sec­tors will also be deep­ened, the guide­line said, with ef­forts to con­tin­u­ously shorten the na­tional and free trade zone neg­a­tive lists for for­eign in­vest­ment and to elim­i­nate re­stric­tions out­side the neg­a­tive lists.

The guide­line also listed eight mea­sures to pro­tect the le­git­i­mate in­ter­ests of for­eign in­vestors, pri­or­i­tize fully im­ple­ment­ing the For­eign In­vest­ment Law — due to take ef­fect on Jan 1 — and pledge to step up ef­forts to for­mu­late re­lated ju­di­cial in­ter­pre­ta­tions.

The au­thor­i­ties will es­tab­lish in­sti­tu­tions to ac­cept com­plaints from for­eign en­ter­prises, im­prove the in­tel­lec­tual prop­erty rights pro­tec­tion mech­a­nism, strictly ban forced trans­fers of tech­nol­ogy and en­sure that for­eign en­ter­prises can com­pete with do­mes­tic play­ers fairly in govern­ment pro­cure­ment.

Mul­ti­ple ap­proaches are also on the way to make it eas­ier for for­eign busi­nesses to in­vest in China and en­cour­age for­eign in­vest­ment, es­pe­cially in high-tech sec­tors, the guide­line said.

Wang Ji­aqiang, re­search di­rec­tor for the bank­ing in­dus­try at the Bank of China, said the above mea­sures, if well im­ple­mented, would help align China’s qual­ity of busi­ness en­vi­ron­ment with worldlead­ing lev­els and forge a “ma­jor boost to for­eign in­vestor con­fi­dence”.

This could re­in­force China’s grow­ing mo­men­tum in at­tract­ing for­eign in­vest­ment, ac­cord­ing to Wang.

“China’s growth prospects, which stand out among ma­jor economies, rel­a­tively higher in­ter­est rate lev­els and the yuan’s prospects for long-term sta­bil­ity are ex­pected to am­plify the coun­try’s al­lure to for­eign in­vest­ment in the next five to 10 years,” Wang said on the side­lines of the an­nual con­fer­ence of the China In­ter­na­tional Fi­nance So­ci­ety on Fri­day.

Wang added that open­ing-up mea­sures in the fi­nan­cial sec­tor are “the most no­table” in the guide­line and will give for­eign fi­nan­cial in­sti­tu­tions a larger mar­ket space to ex­plore and fur­ther level the play­ing field for for­eign and do­mes­tic play­ers.

“The reg­u­la­tory change pre­sents great op­por­tu­ni­ties for in­ter­na­tional in­sur­ance com­pa­nies,” said John Chen, pres­i­dent of Swiss Re China, re­fer­ring to re­lax­ation of quan­ti­ta­tive re­quire­ments for for­eign in­sur­ers to es­tab­lish in­sti­tu­tions in China and other in­sur­ance sec­tor open­ing-up mea­sures listed in the guide­line. Swiss Re is a rein­sur­ance com­pany based in Zurich.

“Swiss Re is com­mit­ted to lever­ag­ing our deep knowl­edge and re­search and devel­op­ment ca­pa­bil­i­ties to part­ner with our clients to de­velop in­no­va­tive, tech­nol­o­gy­based so­lu­tions that help close pro­tec­tion gaps, and de­liver bet­ter prod­ucts and ser­vices to Chi­nese con­sumers,” Chen said.

Al­fred Schipke, the In­ter­na­tional Mon­e­tary Fund’s se­nior res­i­dent rep­re­sen­ta­tive for China, said at the con­fer­ence that China has re­cently made con­crete ac­com­plish­ments in fi­nan­cial open­ing-up, and its fi­nan­cial sys­tem will be­come more glob­ally in­te­grated, which is ben­e­fi­cial for the rest of the world and for China.

“China’s steady progress in open­ing-up will con­trib­ute to the re­cov­ery of the global econ­omy and China’s high-qual­ity devel­op­ment,” said Zhang of CUFE.

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