China will significantly ease market access, further open services sectors, and protect the legitimate rights and interests of foreign investors, Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, said Wednesday.
“Openness brings progress, while self-seclusion leaves one behind,” Xi told delegates to the 19th National Congress of the CPC, which kicked off on Wednesday in Beijing.
In his speech, Xi painted a new pattern for all-round openness of the Chinese market with measures to open up more sectors and regions to foreign investors and efforts to enhance global cooperation through the Belt and Road (B&R) initiative.
“All businesses registered in our country will be treated equally,” Xi said. “We will implement the system of pre-establishment national treatment plus a negative list across the board.”
The new emphasis on treating foreign-backed companies the same as their Chinese counterparts suggests a national direction to create a fair business environment, which could boost the confidence of foreign companies, according to Huo Jianguo, vice chairman of the China Society for WTO Studies.
“In order to attract more foreign direct investment (FDI), the core issue that needs to be solved currently is whether foreign-backed companies can enjoy fair treatment in the country. In this sense, the new statement in the report will help to boost confidence for foreign investors operating in the Chinese market,” Huo told the Global Times on Wednesday.
Though China has been persistent in its efforts to open up the economy, Xi’s speech on Wednesday suggests a more comprehensive path forward, according to Tian Yun, director of the Macroeconomics Research Center’s China Society.
Tian told the Global Times that China is embracing a new pattern of comprehensive opening-up as the country pursues cooperation with countries and regions along the B&R routes.
In the speech, Xi also stressed the significance of both “bringing in” and “going global,” and called upon the country to pursue the B&R initiative as a priority.
“With these efforts, we hope to make new ground in opening up the Chinese market further through links running eastward and westward, across land and over sea,” Xi said.
Since China insists on opening up, the country will play a larger role in the international arena against the backdrop of anti-globalization trends in some Western countries, said a report from the financial research center under Bank of Communications on Wednesday.
Xi called for more efforts to enhance trade and investment liberalization and facilitation, and to make economic globalization “more open, inclusive and balanced so that its benefits are shared by all.”
Xi also stressed the geographic aspect of the country’s opening efforts, putting focus on further opening the western region of the country, Tian pointed out, adding that this was a shift from earlier opening efforts, which focused mostly on the coastal areas in eastern China.
Xi’s remarks on Wednesday came at a time when China has been making solid progress in opening the domestic market and creating a fairer and more efficient business environment, thanks to continued efforts from the government, experts noted.
On August 16, the State Council, China’s cabinet, announced a series of measures for ensuring the steady growth of foreign investment. China should make its foreign investment environment “more law-based, internationalized and convenient” to promote growth and raise the quality of foreign investment, the Xinhua News Agency reported, citing a document from the State Council.
In July, China began to implement a revised foreign investment catalogue. The 2017 catalogue reduces the number of restrictive measures for the entry of foreign investment from 93 to 63, and several industry sectors like services, manufacturing and mining are now more open to foreign capital.
China’s opening efforts have been focused on more advanced industries, given the upgrade in domestic demand, rather than bringing in low-end foreign productive forces, according to Tian.
From January to August, FDI into China’s high-tech manufacturing sector rose 15 percent year-on-year to 43.7 billion yuan ($6.6 billion), and FDI into high-tech services was 81.4 billion yuan, up 21.4 percent, according to data from the Ministry of Commerce.
Source: Global Times