China further shortens negative list for domestic and foreign private investors

The National Development and Reform Commission (NDRC) and the Ministry of Commerce (MOFCOM) have jointly issued the 2022 edition of the negative list for market access. There are 117 items on the list, six items less than in the previous edition issued in December 2020. The 2020 version included 123 items, eight items less than the one in 2019. China introduced market access negative lists in December 2018. The negative list specifies industries which private investors, domestic or foreign, are either restricted or prohibited to invest. This list is different from the negative list for foreign investment, as it applies to both foreign and domestic investors.

The shortened negative list shows China's commitment to further opening up its markets and efforts to provide equal treatment to domestic and foreign market players, Bai Ming, Deputy Director of the Chinese Ministry of Commerce's International Market Research Institute, told the Global Times. For industries that are not on the list, all types of market players can enter the market on an equal footing according to the law, and no separate administrative approval for market access shall be established in violation of regulations, according to the NDRC.

Cui Weijie, Deputy Director of the Chinese Academy of International Trade and Economic Cooperation (CAITEC), believes the government will continue to shorten the negative list and expand market access. Zhou Maohua, Analyst at China Everbright Bank, said China has been working hard to expand market access and opening-up during the past few years. “It’s sending a clear signal that China is committed to optimizing the business environment and encouraging foreign investment participation in China’s development.” Zhou said that by continuously expanding its opening-up process, the country will promote its high-quality development and offer new business opportunities for global stakeholders, thus giving impetus to the global economy.

The NDRC and MOFCOM also called for strengthening the anti-monopoly policies and preventing disorderly capital expansion. “It is necessary to take measures to prevent risks while continuously expanding market access,” Cui from CAITEC, said. “Taking stronger actions against monopolies will help prevent disorderly expansion of capital, its unchecked growth and speculation in the market. That will also help maintain market order and protect the legitimate rights and interests of consumers and relevant market entities.” Jeffery Liu, Vice President of Corning, attributed China’s economic success over the last four decades to its strategic approach that focuses on openness, collaboration, sharing, innovation and sustainability, the China Daily reports.