The Ministry of Industry and Information Technology (MIIT) announced a pilot project to remove foreign ownership restrictions on some domestic value-added telecom services in four regions – Beijing, Shanghai, Hainan and Shenzhen – showing the country's determination to expand opening-up on all fronts. A circular released by the MIIT noted that the value-added telecom services will include internet data centers, content delivery networks and internet service providers, among others. China will provide equal treatment to foreign entities approved for the pilot programs, eliminating the 50% foreign ownership limit in these critical sectors, and it will no longer impose ownership restrictions, the MIIT confirmed. MIIT Minister Jin Zhuanglong noted during this year's two sessions in March that “advancing new industrialization requires deepening reforms and expanding openness.” Widening foreign access in value-added telecom services serves is one of the critical elements of the plan.
The pilot project aims at proactively aligning with international high-standard economic and trade rules, continuously optimizing the business environment for foreign investment, and facilitating the establishment of a new development paradigm, according to the Ministry. The pilot project is in line with China's commitment to shortening the negative list for foreign investment. All market access restrictions on foreign investment in manufacturing will be abolished, and restrictions in services sectors, such as telecommunications and healthcare, will be reduced, according to the Government Work Report released in March. Opening up the telecommunications sector, which is a highly sensitive sector crucial for national security, demonstrates China's confidence. Meanwhile, the pilot approach also reflects the government's cautious and prudent stance, Fu Liang, Beijing-based Tech Analyst, told the Global Times. Particularly in the internet data center sector, it will attract quality foreign data centers and cloud service firms, bolstering China's computing infrastructure, experts noted.
China’s overall fixed and mobile broadband speeds have increased by over 2.5 times in three years, according to a report by the Broadband Development Alliance. In the fourth quarter of last year, the national average fixed broadband download speed reached 83.8 megabits per second (Mbps), up 17% year-on-year, while the average combined 4G/5G mobile broadband download speed exceeded 129 Mbps, up 32% year-on-year. Such speeds would enable the downloading of a 10 gigabyte 1080p high-definition movie in about 16 minutes on a fixed connection, and under 11 minutes on a mobile connection. According to the latest data from network analysis company Ookla, the national averages placed China eighth globally for fixed broadband speeds and sixth for mobile performance, with mobile download speeds well above the 51.1 Mbps global average. China had 805 million 5G subscribers at the end of last year, representing 46.6% of mobile users, 2.5 times the global average 5G penetration rate.
