we will introduce a foreign investment law, amend the patent law, promise more tax cuts and fee reductions, and establish a market environment that is competitive and neutral... a series of opening-up policies have confronted key problems in the field of foreign investment, showing the world china's determination and action to expand opening-up. at the same time, the ministries and commissions are speeding up the preparation of relevant supporting measures to accelerate the implementation of the dividends of opening-up.
the ministry of commerce is working with related departments to revise the negative list of foreign investment access, the economic information daily learned. experts said the "negative list" plus "positive encouragement" will guide foreign investors to change the investment structure and continuously increase the proportion of high-end industrial chain layout, so as to achieve all-round opening and promote high-quality development.
multiple departments will work together to stabilize foreign investment
since the beginning of this year, china has speeded up its opening up to the outside world and introduced policies to improve the environment for foreign investment.
during the two sessions of the national people's congress, the law on foreign investment was formally introduced and came into effect on january 1, 2020. as the basic law in the field of foreign investment, this law has made clear provisions one by one on issues of common concern to foreign investors, such as expropriation and compensation, profit repatriation, protection of intellectual property rights, non-compulsory technology transfer and compliance by local governments. it is widely believed in the industry that the law provides a legal guarantee for china's all-round opening-up.
the patent law is also under revision and is expected to be completed within this year. during the two sessions, shen changyu, director of the state intellectual property office, said an important aspect of the new round of amendments to the patent law is to improve the system of punitive damages for infringement, substantially increase the cost of infringement and impose punitive damages up to five times that of intentional infringers.
china further clarified the timetable for opening up at the bbs annual conference in boao, asia, in 2019. by the end of june this year, the two pilot free trade zones and the national negative list for foreign investment access will be revised and issued again, and the directory of industrial guidance for encouraging foreign investment will be published. and made a "negative list only subtraction, do not add, 'ban or enter' will be fully implemented" commitment.
at present, the ministry of commerce, the national development and reform commission and other relevant departments have conducted research to further reduce the negative list of market access.
in addition, gan lin, deputy director of the state administration of market supervision, said recently that fair competition review will be taken as an important starting point and an effective way to implement the principle of competition neutrality.
the treasury also promised bigger tax cuts. china will implement bigger tax cuts and cut fees to create a more attractive investment and business environment, finance minister liu kun said at the 99th development committee meeting yesterday.
china has become a hot destination for foreign investment
with the construction of omni-directional opening pattern, china has become a hot land for foreign investment. in 2018, china's actually utilized foreign investment reached us $138.3 billion, ranking first among developing countries. more than 60,000 foreign-funded enterprises were set up last year, up 69.8 percent. "this is in spite of a 19 per cent drop in global cross-border investment." qian keming, vice-minister of commerce, said at the development forum bbs in march.
the intensive release of the positive effects of the recent opening up has increased the attractiveness of china to foreign investment. the momentum of steady growth is not only clear, but also the trend of structural optimization is more obvious. according to the latest data, 6,509 foreign-invested enterprises were set up in the first two months of this year. actual foreign investment reached 147.11 billion yuan, up 5.5 percent year-on-year. among them, the actual use of foreign capital in high-tech industries increased by 48.4% year-on-year, accounting for 27.6%. high-tech services, such as information services, research and development and design services and transformation of scientific and technological achievements, grew by 101.9 percent, 29.2 percent and 76.4 percent, respectively, year-on-year.
"these data changes reflect the increasing attractiveness of our country to foreign investment. despite the fierce international competition for investment, china has continuously enhanced its supporting capacity for high-level industries, high-quality human resources, an optimized business environment and huge market potential. bai ming, deputy director of the institute of international market research at the ministry of commerce, told the economic information daily that all this has created conditions for china to make better use of foreign capital.
faced with huge market dividend, many foreign investors have accelerated the pace of investment in china. apple ceo tim cook said recently that openness is not only important to china's potential, but also to the prosperity of the global economy as a whole.
ma qin, president and ceo of canada's pension fund investment corporation, also told the economic information daily that china is the main source of global economic growth, and such a market will not be abandoned by all investors. we will further increase our investment in china.
use foreign capital to stride toward high quality
"at present, the work of attracting foreign investment in china has passed the stage of scale expansion, and the next stage is to achieve new breakthroughs in quality improvement." wu qi, a senior researcher at the pangu think tank, told the economic information daily that boosting foreign investment is the way to go and improving the quality of foreign investment is the root.
the ministry of commerce has also recently made it clear that china's absorption of foreign investment is at a crucial stage of transformation and upgrading. in terms of the structure of foreign investment utilization, china will focus on increasing the proportion of high-end industrial chain.
"to promote high-quality development through all-round opening-up, we need to walk on two legs." chi fulin, director of the china (hainan) institute of reform and development, told the economic information daily that the opening-up of high-tech manufacturing and high-tech service industries should be pursued simultaneously, especially the opening-up of productive services to boost the transformation and upgrading of the manufacturing sector.
chi fulin pointed out that the prominent contradiction of "big but not strong" manufacturing industry in china lies in the lagging development of producer services such as r&d and design. more favorable conditions should be offered, mechanisms for talent introduction and intellectual property protection should be improved, and worries about foreign investment should be eliminated. we will also focus on establishing fair and transparent competition policies, and increase the "golden content" of policies in business areas after foreign investment.
wu qi suggested that in the future, we should focus on guiding foreign investment structure from manufacturing and heavy chemical industry to modern service industry, new energy vehicles, biological medicine, intelligent manufacturing and other fields. we will promote the transformation of foreign capital into diversified forms of investment, including joint ventures, mergers and acquisitions, pe equity investment, vc venture capital, and angel investment. we will encourage the transfer of foreign investment from coastal and border areas to inland areas. at the same time, we will do a good job in absorbing and reinnovating the advanced technologies and equipment introduced to improve their application.
bai ming said that in the field of high and new technology, we will encourage the introduction of foreign investment projects and introduce supporting policies to give full play to the spillover effect of foreign investment and promote the effective integration of foreign investment utilization and economic transformation and upgrading. "in this process, we need to improve the mechanism of competition and cooperation, carry out the survival of the fittest in a market-oriented way, and encourage chinese-funded and foreign-funded enterprises to cooperate with each other to learn from each other's strengths and achieve industrial upgrading."
source: china financial information network