China has released the 2022 catalogue of industries for encouraging foreign investment to attract more investment and expand opening-up. Analysts said the revised catalogue will help boost foreign investment in key industries like advanced manufacturing, high- tech, modern services and environmental protection. It will also help facilitate greater inflow of foreign capital into the country’s central and western regions. That will reinforce China’s position in global industrial and supply chains and eventually inject more stability into the global economy, they said. To take effect on January 1, the updated catalogue has 1,474 items, among which 239 are new and 167 are modified from those in the previous catalogue released in 2020, according to a statement from the National Development and Reform Commission (NDRC).
“The items applicable on the national level continue to focus on encouraging foreign investment in the manufacturing sector to enhance industrial and supply chains,” said an NDRC official in the statement. “The modifications of the national items mainly target promoting the integration of services and manufacturing sectors,” the official said, adding items for central and western regions are designed in accordance with the specific labor and resource conditions of different places. For instance, new or revised national items in the catalogue cover sectors including aviation equipment manufacturing, key industrial components used in autonomous driving, and high- performance raw materials. They also cover advanced integration technologies and services for low-carbon environmental protection, energy and water conservation, as well as recycling of decommissioned wind turbine blades and photovoltaic module waste.
Zhou Mi, Senior Researcher at the Chinese Academy of International Trade and Economic Cooperation in Beijing, said the revised catalogue has been adapted to China’s current external and internal conditions to better attract foreign investment. “As the global economy has seen major changes in supply and demand dynamics and industrial structures since 2020, countries around the world are competing to attract foreign investors, although with differentiated focuses on specific areas,” Zhou said. “China is expected to better attract and promote foreign investment under the principle of reinforcing coordination between foreign investment and the development of China’s industrial and supply chains,” he said, adding that this will further allow for the sharing of China’s development opportunities with foreign investors and the rest of the world. Liu Ying, Researcher at Renmin University of China’s Chongyang Institute for Financial Studies, said the country’s accelerated moves to expand opening-up, as reflected by the revision of the catalogue, will intensify its position as a key player within the global networks of industrial and supply systems.
Against the backdrop of the struggling global economy and industrial and supply chain reconstruction, China’s further opening-up will help to build more open, stable and elastic global industrial and supply chains while contributing to new worldwide growth momentum, Liu said. The catalogue was jointly released by the NDRC and the Ministry of Commerce (MOFCOM), the China Daily reports.
The National Development and Reform Commission (NDRC), along with five other Ministries, also issued 15 measures to facilitate the implementation of foreign-invested projects, with emphasis on the manufacturing sector. The measures specify the direction and key tasks in utilizing foreign investment in the current and coming period, with the aim of attracting more foreign capital, stabilizing existing foreign investment and improving the quality of foreign investment. It also calls for letting foreign investment boost the high-quality development of the Chinese manufacturing sector so that it further integrates into the global economy. In terms of boosting foreign investment, the document released by the NDRC calls for “converting the opening-up policy into concrete and tangible foreign-invested projects” and pushing the “fast-tracked implementation of signed projects.”
The measures call for attracting investment by multinational companies in the medical, semiconductor and chemical industries and foreign investment in high-end equipment, basic components and key parts, modern services, green and innovative technologies. Eligible foreign companies will be allowed to list on Chinese stock markets, including the main board, the sci-tech innovation board and the ChiNext board. Under the premise of ensuring Covid-19 epidemic prevention and control, the measures call for more streamlined facilitation for international travel for foreign company executives, management, key personnel and their relatives. It urged localities to fully use existing fast-track travel channels, including further specifying standards and procedures based on the local situation.
Bai Ming, Deputy Director of the International Market Research Institute at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times that as the first policy package related to the country's opening-up policy after the conclusion of the key Party Congress, the move signals China's determination in opening up its market to foreign companies and sharing its growth opportunity with more and more foreign companies. Experts said the emphasis on manufacturing reflects the spirit of the key meeting, which called to upgrade China's manufacturing capacity among other measures to develop the real economy. Yao Jingyuan, Special Researcher at the Counselors' Office of the State Council, said that the high-quality development of Chinese manufacturing needs the participation of foreign companies, and investment in Chinese manufacturing in turn will generate high returns for multinational companies. Investing in China's manufacturing is investing in the future, he noted. Investment in the manufacturing sector grew 10.1% in the first three quarters. “Manufacturing is set to further gain pace in the fourth quarter while playing an even more important role in the Chinese economy in 2023,” Yao said, as reported by the Global Times.
