The Chinese government has announced the further opening-up of the services sector to foreign investment in six trial cities: Shenyang in Liaoning province, Nanjing in Jiangsu, Hangzhou in Zhejiang, Wuhan in Hubei, Guangzhou in Guangdong, and Chengdu in Sichuan province. These pilot cities will allow more access to foreign investments in the aged care, travel, telecom, entertainment and live performance businesses. For example, foreign companies can establish non-profit aged care institutions in Hangzhou, Guangzhou and Chengdu. They are also allowed to set up travel agencies in Shenyang, Nanjing, Guangzhou and Chengdu and operate outbound travel business to areas excluding Taiwan. Local authorities in Nanjing, Wuhan, Guangzhou and Chengdu will be allowed to approve live performances of foreign groups, which previously required approval from the central authorities. In the telecom sector, Shenyang, Nanjing, Hangzhou, Guangzhou and Chengdu will open up virtual private network (VPN) services to foreign investment through joint ventures.
In recent years, foreign investment in China's service sector has grown rapidly. As Chinese people become wealthier, there has been a significant increase in demand for services such as aged care, quality of life improvements and various value-added services, Zhang Yansheng, Chief Researcher of the China Center for International Economic Exchanges, told the Global Times. The pilot cities are among China's new first-tier cities, which are well-developed and possess unique strengths, making them appealing to foreign capital. Hu Qimu, Deputy Secretary General of the Digital-Real Economies Integration Forum 50, told the Global Times that China's tourism sector was recovering. Both foreign and domestic tourists are placing higher demands on services. China recorded 14.64 million inbound trips made by foreigners in the first half of this year, up 152.7% year-on-year, following measures introduced since January, the National Immigration Administration (NIA) announced.
Foreign direct investment (FDI) in the Chinese mainland, in actual use, totaled CNY412.5 billion in the first five months of 2024. A total of 21,764 new foreign-invested firms were established in China in the period, an increase of 17.4%, the Global Times reports.
