China Trustworthy for Investment, says President Xi Jingping
By Morris Dogga in Shanghai
Chinese President Xi Jingping said his country will continue to relax its laws on foreign investment and enhance an enabling business environment.
In the past laws, Beijing had set tougher laws for foreign investment. Under the 2017 Catalogue, foreign investors are incentivized to invest in “Encourage” Sector and are banned from investing in “Prohibited” sector. The restrictive measures include shareholding limitation and requirement regarding the high ranking executives.
But a new Foreign Investment Law enacted early this year is set to take effect on January next year. The new modified law will enable foreign investors to enjoy equal rights as the domestic companies.
The new Foreign Investment Law does not establish a minimum percentage of foreign ownership to qualify as an Foreign Invested Enterprise (FIE), the threshold under past FIE laws was 25 per cent.
According to the world World Bank Business Report on 2020 published last month, China climb 15 places from 46 to 31. China announced the “Regulations on Optimizing the Business Environment.
Xi said China will continue to accelerate the pace of reform in key areas and important areas in response to the prominent contradictions that constrain economic development.
He said the second largest economy will promote the coordinated development of import and export, trade in goods and services, bilateral trade and two-way investment.
“China will pay more attention to the role of imports, further reduce tariffs and institutional costs, foster a number of import trade promotion innovation demonstration zones, and expand imports of high-quality products and services from countries,”
“We are a trustworthy country, and all we say are counted,” the Chinese leader said during opening ceremony of the China International Import Expo (CIIE) in Shanghai on Tuesday,
He further mentioned that China will promote the orderly and free flow of international and domestic factors, efficient allocation of resources, and deep integration of markets.
France President Emmanuel Macron urged China to be transparent in allowing foreign companies to access the Chinese Market.
He further called on the need to speed up the process of foreign companies to access the Chinese Market in a transparent process.
“Foreign Companies have to be treated equally”
Mr Xi Jingping commented that the full implementation of the pre-entry national treatment plus negative list management system has been introduced and significant progress has been made in expanding imports to promote consumption and further reducing tariffs.
“No country can solve the problems facing the development of the world economy. Countries should adhere to the concept of human priority, and should not put their own interests above human interests.
“We must use a more open mindset and initiatives to jointly expand the cakes in the global market, to implement the global sharing mechanism, to work in a global way, and to work together to increase the momentum of economic globalization. Small is better.”
Speaking also at the opening ceremony, World Trade Organisation, Roberto Acevedo, said urged countries to opens up their market stating that open markets have allowed companies to devote their finances and do what they do well.
Mr. Azevedo warned that restrictive laws are deterring in investors which has led to a slow growth of the world economy
“Investors are thinking twice against committing to big purchases and cross border relation because they fear that their profit margin will be eroded or wiped out by trade restrictions, “ He said.
A total of 64 countries will be exhibiting their products and more than 3,000 companies are taking part, according to the organizers. However, South Sudan is not among those Countries.
The expo that will run up to the 10, November 2019 will feature exhibitions of multiple countries and businesses and the Hongqiao International Economic and Trade Forum.
Announced In May 2017 by the Chinese President Xi Jinping announced, The CllE is decision taken by the Chinese government to firmly support trade liberalization and economic globalization while actively opening up China’s markets to the world.
The Expo will enhance the promotion of economic and trade exchange and cooperation among all countries, promote global trade and economic growth, as well as develop an open international economy.