China has maintained its position as the world’s second-largest recipient of foreign investment since 2017 and remains one of the most attractive investment destinations globally.
Despite the rising tide of de-globalization and protectionism, China has remained committed to high-level openness to boost foreign investment, providing much-needed certainty and opportunities for global business.
As the world’s second-largest economy, top trading nation, and a major magnet for global investors, China, through further opening up, will not only boost its high-quality development but also create ample opportunities for the world, said guest speakers at the third edition of the China Economic Roundtable, an all-media dialogue platform organized by Xinhua News Agency.
While pursuing high-quality development, China has been working to expand institutional openness concerning norms, regulations, management, and standards, to increase the level and quality of trade and investment cooperation.
“Institutional openness will be the centerpiece of China’s opening up to the outside world,” said Zhang Wei, vice president of the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce.
Zhang added at the roundtable that China’s strong economic fundamentals have remained unchanged, with competitive industrial and supply chains, while its advantage of a vast domestic market is expected to be further strengthened.
“The expansion of institutional opening will be an effective way and a strong support for the country’s high-quality development,” Zhang said.
In its most recent decision on the matter, in December 2023, the State Council, China’s cabinet, issued a comprehensive plan to promote the high-level institutional opening of China’s Pilot Free Trade Zone (Shanghai), aligning it with international economic and trade norms of high standards.
The plan includes a total of 80 measures, such as initiatives aimed at facilitating trade in goods and services, promoting digital trade, and strengthening intellectual property rights protection, among others.
The expansion of institutional opening serves as a guarantee for foreign investors, as the country focuses on further facilitating market access and ensuring fair competition, said Zhao Yugang, an official of the Shanghai Pilot Free Trade Zone management committee.
China’s Ministry of Foreign Affairs said on Thursday that in 2024 the country will continue to expand high-level opening, further facilitate market access, and share with the world the new opportunities generated by the country’s modernization.
Easier market access
Under the high-level opening-up policy, China has issued a series of measures to facilitate market access and provide a level playing field so that foreign enterprises can enjoy a better business environment in the country.
Last year, China renewed the Catalogue of Industries Incentivised for Foreign Investment, adding 239 items, which is a record.
At the same time, the country is also actively seeking to continuously lower the threshold and reduce the costs and risks associated with foreign investment. The number of industries and products on the negative lists at the national level and for the pilot free trade zones has been reduced to 31 and 27, respectively.
Regarding the financial sector, the country implemented more than 50 financial liberalization measures in recent years, including the removal of limitations on foreign ownership in the banking and insurance sectors, as well as the reduction of access criteria for foreign investors.
The Central Economic Work Conference, held in late 2023, emphasized the need for efforts to foster new drivers of foreign trade, consolidate overall foreign trade and foreign capital performance, and expand trade in intermediate goods, services, digital and cross-border e-commerce exports.
The meeting, which reviews and defines measures to govern the operation of the national economy in the coming year, also noted that market access should be facilitated in the areas of telecommunications, medical services, and other service industries while requesting greater efforts to align with global high-level economic and trade standards, resolve issues such as cross-border data flow and fair participation in government procurement, and make “investing in China” a popular choice.
The meeting has sent a positive signal that China will continue to expand openness and attract more foreign investment, which will give foreign investors stable expectations and hedge the “uncertainty” of the external environment with the “certainty” of openness, said Zhu Bing, director of the Ministry of Commerce’s Foreign Investment Management Department.
Looking ahead, Zhu said the country has many favorable conditions to attract foreign investment, adding that the country will further open its doors to the world. According to him, multinationals will continue to expand their presence in China and share the dividends of China’s high-quality economic development, as “investing in China means investing in the future”.
A better business environment
China has been intensifying its efforts to create a high-standard business environment that is market-oriented, law-based and internationalized.
On 1 January 2020, the landmark Foreign Investment Law came into force, which includes a comprehensive and fundamental set of legal rules for foreign investors that aims to better protect the rights and interests of foreign investors.
With unified provisions for the entry, promotion, protection, and management of foreign investment, China’s Foreign Investment Law has addressed the concerns of foreign enterprises and facilitated foreign investment.
According to a report released by the Development Research Centre of the State Council, China has maintained its position as the world’s second-largest recipient of foreign investment since 2017 and remains one of the most attractive investment destinations globally.
Zhang Wei expressed that China’s attractiveness for foreign investment now lies in its comprehensive advantages, which include adequate cost performance, well-developed support facilities and optimized business environment, as well as a wealth of opportunities.
Zhang added that the country can not only offer a conducive business environment for foreign investors to operate and prosper but also provide ample room for further development and profitability.
Article originally published by Xinhua.
