China will make great efforts to create a stable and transparent policy environment, a unified and open market environment and a standardized and efficient administrative environment for foreign investment, said China's Ministry of Commerce in a report issued on May 31. It will stabilize and enlarge the scale of foreign investment attracted and boost the quality and levels of foreign capital utilization, so that foreign capital will better play a positive role in promoting independent innovation, industry upgrading and regional coordinated development.
The report said changes in the external environment, induced by the international financial crisis, is the major reason why the attraction of foreign capital in China has dropped. Due to relatively large uncertainties in the internal and external environments, it will be difficult to restore foreign investment growth in China in the short term.
In 2008, the total number of foreign enterprises accounted for around three percent of businesses nationwide. These foreign enterprises' industrial output value accounted for 29.7 percent of the national total, taxes paid accounted for 21 percent, export value accounted for 55.3 percent and import value accounted for 54.7 percent. These companies directly hired 45 million people.
To create a favorable environment to attract foreign investment, China will organize and standardize the administrative fee and inspection regulations involving foreign investment, and further transfer the jurisdiction for examining and approving foreign investment to lower government levels. It will make great efforts to promote online examination and approval procedures, and improve foreign invested enterprises' joint annual inspection system.
Secondly, China will strengthen guidance for industries and optimize industry structures for foreign investment. It will actively channel foreign capital toward the new and high technology industry, advanced manufacturing industry, energy-saving and environmental-friendly industry and the modern service sector.
China will also encourage foreign companies to invest in agriculture, crop farming, aquaculture and farm produce deep-processing that require higher levels of technology, have more added value, and can boost farmers' income. It will encourage foreign companies to develop international service outsourcing and support foreign companies to actively participate in various investment projects that the country has arranged for domestic demand expansion, and to play an active role in the adjustment and revitalization plans of key industries.
China will further encourage multinationals to set up regional headquarters, research and development (R&D) centers, distribution centers, procurement centers and training centers in China, improving the functions of regional headquarters.
Thirdly, it should promote foreign companies to invest in China's central and western regions. It is necessary to improve the support policies to further open up and attract foreign investments, as well as to research and formulate policy measures for the expansion of opening-up along international borders, and to intensify the support for infrastructure construction of national-level economic and technological development zones within China's central and western regions.
Fourthly, China should pay close attention to the development and impact of the international financial crisis, and strengthen the collaboration between various government departments to efficiently solve the operating difficulties of enterprises. It is necessary to study and improve policies on the domestic listing of foreign-funded enterprises. Meanwhile, China should provide convenience to enterprises to expand in Chinese domestic markets, helping them stabilize their production scale so as to avoid job cuts.
The report stated that the long-term trends for China's political stability and economic development remain unchanged. With the accelerated development of industrialization and urbanization, the huge potential of China's domestic markets will be continually unleashed.
A series of measures that have been gradually adopted to cope with the financial crisis, including the expansion of the domestic demand, the maintenance of financial stability and the promotion of revitalizing industries and technological innovations, which will offer new opportunities and development room for foreign investment.
The report also noted that the World Investment Prospects Survey 2009-2011, issued by the United Nations Conference on Trade and Development reveals that factors such as steady economic growth, great domestic market size, low labor costs and the opening-up of markets will enable China to remain the most attractive destination country of foreign investment.
The American Chamber of Commerce in the People's Republic of China (AmCham-China) recently announced that among the US enterprises surveyed, over 80 percent are optimistic about the prospect for their operations in China and 73 percent are planning to expand their investments in China. For instance, Siemens invested an additional 190 million USD in its regional headquarters located in China this January, further boosting the production capacity and operational activities in the field of alternative energy.
By People's Daily Online
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