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E-mail China.org.cn, September 10, 2024
21st Century Business Herald:
Not long ago, MOFCOM announced data and information on China's use of foreign investment from January to June. This year, newly established foreign-invested enterprises in China have increased, while actual use of foreign capital has declined. How do you view the current situation of attracting foreign investment, and what tasks will you focus on next? Thank you.
Li Yongjie:
Let's invite Mr. Zhu to answer your questions.
Zhu Bing:
Thank you for your attention to our efforts to attract and utilize foreign investment. As Ms. Li announced in her opening remarks, the actual amount of foreign capital utilized in the first half of this year was close to 500 billion yuan, maintaining a relatively high level compared to the past decade. Frankly speaking, the scale of foreign investment has experienced a year-on-year decline, primarily attributed to the exceptionally high base in the same period last year.
From a structural perspective, the composition of foreign investment has been continuously optimized. The proportion of actual foreign investment in China's high-tech manufacturing industry increased by 2.4 percentage points compared to the same period last year. Similarly, the proportion of foreign investment in the overall manufacturing industry also rose by 2.4 percentage points compared with the same period last year. These two instances indicate that the structure is being optimized and that foreign investors are actively adjusting their investment layouts across various industrial sectors. This trend aligns with China's broader initiatives to accelerate the development of new quality productive forces and advance new industrialization.
The underlying trend of China's economic recovery and long-term growth remains unchanged. China's comprehensive advantages — including its ultra-large-scale market, supply of high-quality industrial systems, and availability of high-end talent — continue to attract foreign investment. Most multinational companies are optimistic about long-term investment prospects in China, so they continue to increase their investments. As mentioned, nearly 27,000 new foreign-invested enterprises were established in the first half of this year, a 14.2% year-on-year increase. This figure demonstrates continued activity and continues the trend of rapid growth in the number of foreign-invested enterprises that we've seen since last year.
The third plenary session of the 20th CPC Central Committee detailed a comprehensive plan for attracting and utilizing foreign investment. Next, we will deeply study and implement the guiding principles of the third plenary session. We will uphold the Party's overall leadership, adhere to a people-centered approach, uphold fundamental principles and break new ground, strengthen institution building as our main task, stay committed to law-based governance on all fronts, and apply systems thinking. We will increase efforts to attract and utilize foreign investment. Moreover, we will pursue high-standard opening up to advance in-depth reform and high-quality development. Specifically, this includes the following aspects:
First, we will steadily expand institutional opening up. As previously mentioned when discussing pilot free trade zones, these areas play an important role in foreign investment, accounting for 20.8% — a significant share. Therefore, the work of pilot free trade zones is also crucial to foreign investment efforts. We will align with high-standard economic and trade rules mainly through pilot free trade zones and free trade ports. This will help achieve interoperability of rules, regulations, management and standards in multiple fields. We aim to leverage the exemplary role of pilot free trade zones and the Hainan Free Trade Port, while promptly extending qualified pilot measures to free trade zones nationwide.
Second, we will further relax market access. We will expand the catalog of industries that encourage foreign investment and publish the 2024 version of the negative list for foreign investment access. We will implement measures proposed by General Secretary Xi Jinping to remove all restrictions on foreign investment access in the manufacturing sector, meaning restrictions on the manufacturing industry throughout the country should be eliminated. At the same time, in light of our own development needs, we will promote orderly opening up in areas such as telecommunications, the internet, education, culture and medical care. We will also revise the Measures for Strategic Investment by Foreign Investors in Listed Companies to encourage more high-quality foreign capital to enter our capital market for long-term investment.
Third, we will deepen the reform of mechanisms and systems to promote foreign investment. We will focus on building the "Invest in China" brand and enhancing the effectiveness of key investment expos, including the notable China International Fair for Investment and Trade (CIFIT) hosted in Xiamen, along with other landmark events. We will improve the system for assessing the effectiveness of efforts promoting foreign investment, support regions in innovating their investment attraction models, and focus on advantageous fields to elevate the precision of investment solicitation, thereby drawing in more high-quality foreign capital.
Fourth, we will continue to enhance various opening-up platforms. This includes promoting comprehensive trials and demonstrations for expanding the opening up of the service sector. We will introduce new pilot projects to increase openness and innovation in fields such as value-added telecommunications, medical and health services, the digital economy, cultural tourism and transportation, and commercial aerospace and related niche consumption. This year marks the 40th anniversary of the establishment of the inaugural batch of state-level economic and technological development zones. We are committed to the high-quality development of these zones, which is crucial in catalyzing an open economy and fostering new quality productive forces.
Fifth, we will continue to optimize the environment for foreign investment. Annual assessments will be conducted on the effective implementation of the "Opinions of the State Council on Further Optimizing the Business Environment for Foreign Investment and Increasing the Attraction of Foreign Investment," i.e. 24 measures for boosting foreign investment. Each policy and measure will be thoroughly implemented. In line with directives from the State Council, we are further refining the roundtable meeting system for foreign-funded enterprises, as well as the mechanism for handling complaints by foreign investors, providing timely assistance to enterprises in overcoming difficulties. This ensures that foreign enterprises enjoy national treatment in terms of access to production factors, qualification licensing, standards setting and government procurement, thereby sharing the dividends of China's reform and opening up.
That is all from me. Thank you.
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