China on Sunday announced a new version of the list of areas where it does not allow foreign investment, reducing the banned areas from 31 to 29 and eliminating all restrictions on the manufacturing sector, official sources reported.
The list, which will take effect on Nov. 1, is “an important step in building a new system of higher-level economic opening-up,” an official with the National Development and Reform Commission (NDRC), the Asian country’s top economic planning agency, was quoted as saying by the official Xinhua news agency.
According to the source, the NDRC will work with the Ministry of Commerce and other departments to ensure that the new opening measures are implemented in a timely manner.
In March this year, the planning entity announced that it had begun reviewing its industrial catalogue of sectors in which it hopes to attract foreign capital, a process in which the manufacturing sector would be a priority.
The same month, Chinese Premier Li Qiang assured that China would try to attract more foreign investment with measures such as completely removing limits on the entry of foreign capital into the manufacturing sector or partially in the case of telecommunications or health.
In fact, it was also announced today that wholly foreign-owned hospitals will be allowed to open in several Chinese cities, including major cities such as Beijing, Shanghai, Guangzhou and Shenzhen, in addition to the tourist island province of Hainan.
Lowest investment in 30 years
Direct investment by foreign companies in China increased by about $33 billion in net terms in 2023, the lowest figure in three decades, according to a measure by the State Administration of Foreign Exchange (SAFE).
Trade media say foreign companies are pulling money out of the country amid growing geopolitical tensions and rising interest rates in other states that have raised them to combat inflation while China has lowered them in an attempt to spur economic recovery after three years of lockdown due to the pandemic.
China has set its gross domestic product (GDP) growth target for the current year at “around 5%” after a year marked by weak domestic and international demand, deflation risks and insufficient stimulus measures, a property crisis that has not bottomed out and a lack of confidence in the private sector.
