China has come out with 22 measures to further expand the high-level opening-up and attract more resources, including technologies and talents from the global market, to reinforce its strength in attracting foreign direct investment, said a circular unveiled by the Ministry of Commerce on Monday.
The government will implement the pre-establishment national treatment plus negative list management system regarding market access and the 2020 version of the Catalog of Industries for Encouraging Foreign Investment to promote the integration of attracting foreign capital, talents and technologies, said the document.
The 22 measures have been put forward in five areas, including improving government services and building a better legal environment for overseas investors to make plans for stabilizing foreign investment this year.
In addition to promoting the integration of international and domestic industrial chains, the country will establish a cluster of pilot areas for trade-in services, support the innovation and industrial upgrading of national economic development zones and improve the growth level of cross-border economic cooperation zones to actively promote opening-up policies at the regional level.
The ministry is currently compiling the development plan for utilizing foreign investment during China's 14th Five-Year Plan period (2021-25).
China continued to remain an attractive destination for overseas investment in January, with the actual use FDI in the Chinese mainland expanding 4.6 percent on a yearly basis to 91.61 billion yuan ($14.17 billion), according to latest data released by the Ministry of Commerce.
Zang Tiewei, a spokesman for the Legislative Affairs Commission of the National People's Congress (NPC) Standing Committee, said the Foreign Investment Law has created a more market-oriented, legalized, and international investment environment for foreign investors, and guaranteed FDI growth in China last year.
As part of the law, foreign-invested enterprises will be granted access to government procurement markets through fair competition.
Last year, the top legislature also revised and made a few more laws, such as on patents, copyright and Hainan Free Trade Port, providing a better legal environment for foreign investors and enterprises, he said.
Rajat Agarwal, president of China operations at Henkel, the German industrial and consumer goods manufacturer, said that during the last three decades of its existence in China, the company has seen how the deep market reforms have strengthened economic development and how the latest policies, including the recently announced high-standard market system, are injecting new growth momentum.
"We are looking forward to the deepening of the dual-circulation development pattern, in which domestic and overseas markets reinforce each other with the domestic market being the mainstay, thereby reinforcing the strong business environment for foreign enterprises in China and opening a new chapter of shared opportunities," he said.
As China and its partners signed the Regional Comprehensive Economic Partnership agreement and the country completed the Comprehensive Agreement on Investment with the European Union in principle in late 2020, and China plans to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, these free trade deals will attract more foreign capital to China in the long run, said Wei Xiaoquan, a researcher specializing in regional economic development at the University of International Business and Economics in Beijing.
With the Agreement on Geographical Indications between China and the EU coming into effect on Monday, the Ministry of Commerce said the deal is China's first comprehensive and high-level bilateral treaty on geographical indications.
Through the deal, China and the EU mutually recognized geographical indications on a large scale for the first time, covering more than 500 products. The two parties also agreed that protected geographical indications can use the other party's official signs. It is conducive to the development of the market for related products, the ministry said in another statement on Monday.