China is reaffirming its commitment to further opening up its domestic markets to foreign businesses, even as global trends lean towards deglobalization and protectionism. Despite some foreign media claims that China is self-isolating and focusing more on national security than on economic development, Chinese officials emphasize the nation’s dedication to fostering a high-standard business environment for global investors.
President Xi Jinping highlighted that prioritizing domestic circulation does not equate to developing behind closed doors. “It aims to forge stronger connectivity between internal and external markets, better capitalize on the resources of the two markets, and achieve more robust and sustainable development by leveraging the potential of domestic demand,” he stated.
To facilitate this, China is introducing new rules, regulations, and standards to ease market access and create a level playing field for foreign companies. The nation aspires to establish “a top-notch business environment that is market-oriented, law-based, and internationalized.”
While some foreign investors express concerns over China’s domestic economic uncertainties, real estate challenges, local debts, demographic shifts, youth unemployment, and enhanced national security regulations, Chinese officials remain optimistic. Although foreign direct investment saw a decrease in 2023 compared to 2022, initiatives are underway to reverse this trend.
The State Council recently issued 24 guidelines aimed at attracting more global capital and optimizing the business landscape for multinational corporations. These provisions encourage foreign investors to establish significant scientific research projects, ensure equal treatment of foreign and domestic companies, enable secure cross-border data flows, and empower foreign enterprises to participate fully in government procurement. Additionally, foreign-invested projects in biomedicine will experience accelerated implementation.
China offers an ultra-large market and a comprehensive industrial chain, with over 220 industrial products ranking first globally in terms of output. In 2023, the Catalogue of Industries Encouraged for Foreign Investment was expanded to include 239 new items.
A notable local initiative is unfolding in Hunan Province, where Party Secretary Shen Xiaoming is spearheading a campaign to “emancipate the minds” of local officials. The campaign focuses on opposing local protectionism, reducing market fragmentation, eliminating discrimination against foreign businesses, and guiding the behavior of local officials towards a more open and fair market environment.
China’s drive to open up further is rooted in its own economic interests. By welcoming foreign companies that bring advanced technologies and expertise, the nation enhances competition, which spurs innovation among Chinese companies. This dynamic benefits Chinese consumers through access to better goods at competitive prices.
In essence, China’s future continues to be intertwined with greater openness and integration into the global economy.
Reference(s):
cgtn.com
