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China tests ‘negative list’ approach in four regions

Updated: Apr 9,2016 9:38 AM     Xinhua

BEIJING — A “negative list” approach, which identifies sectors and businesses that are off-limits or restricted for investment, has been tested in four regions, including Tianjin, Shanghai, Fujian and Guangdong, authorities announced on April 9.

China’s top economic planner, the National Development and Reform Commission, said it has handed out the draft plan on the approach to the above-mentioned four areas, which specified 96 items that are off-limits and 233 items that are restricted for investment.

The pilot is a major step toward 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 startups to bring out the potential of various market entities as the economy slows.

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