China has introduced and implemented a slew of preferential policies since the start of this year to facilitate the development of high-level free trade and investment, which is aimed at helping foreign investors navigate China’s market, People’s Daily reported on Dec 20.
The first 11 months saw the establishment of 30,815 foreign-funded enterprises in China, up 26.5 percent year-on-year, while the lump sum of foreign capital for actual utilization reached 803.62 billion yuan ($121.9 billion), up 9.8 percent year-on-year.
Foreign investors draw confidence from China’s policies
China formulated five new approaches to ushering in foreign investments, including persistent opening-up, optimizing the business environment, introducing foreign-funded manufacturing, streamlining market institutions, and enhancing industrial restructuring.
Foreign investments in China’s industries retained an overall increase over the first 11 months. Foreign capital utilized in manufacturing reached 207.76 billion yuan, up 0.2 percent year-on-year, representing 25.9 percent of the total amount, while the corresponding figures for the services industry were 582.75 billion, 13.5 percent, and 72.5 percent, respectively.
Foreign investments benefit from Negative List
Gone are the days when it took 20 workdays on average for foreign investors to obtain certificates to establish enterprises. With the introduction of the Negative List Management Mode, which greatly simplified the previous case-by-case approval system, the whole process has been reduced to only three days.
In addition, over 96 percent of foreign enterprises can finish registration and alteration online thanks to Internet Plus government service and information sharing among all departments concerned.
In addition, amendments to four laws regarding foreign-funded enterprises further legally helped the implementation of the Negative List Management Mode, bringing considerable convenience to enterprises.
Foreign investments flock to China
According to officials at the Department of Foreign Investment Administration of the Ministry of Commerce, China remains an appealing destination for investment and mid- to high-end industries by virtue of its sophisticated infrastructure, ample talented human resources and rapid market development.
According to a report on businesses in China in 2017 by the American Chamber of Commerce in Shanghai, 77 percent of American enterprises gained profits in 2016, up 6 percent year-on-year, among which 73.5 percent witnessed profits rise, up 12 percent year-on-year.
Additionally, foreign capital also acted as an outstanding driver of industrial transformation and upgrading. Foreign investments in high-tech manufacturing saw sustainable growth over the first 11 months, with actual utilization totaling 60.15 billion yuan, up 9.9 percent year-on-year. The figures for high-tech services industry were 177.1 billion yuan, a 100.9 percent increase.
In the next phase, the government will relax more restrictions on market access, promote the overall implementation of the Pre-establishment National Treatment and the Negative List Management Mode, encourage more high-quality foreign capital to flow into the middle and western regions, and grant more autonomy to the free trade areas, according to officials at the Department of Foreign Investment Administration.