List of restrictions on foreign direct investment in free-trade zones cut
June 19, 2017 Category Foreign investment, Weekly
As foreign direct investment (FDI) into China stagnates, Beijing is trying to reignite interest by reducing the number of restrictions on investors in certain areas. The State Council said in a statement it had cut its negative list from 122 to 95 in 11 free-trade zones (FTZs). That means fewer restrictions for foreign capital in the trial free-trade zones – including in Shanghai, Zhejiang and Chongqing – where trade and financial rules have been relaxed. Reducing the list is a bid to make it easier for foreign investors to enter some sectors that were previously off limits, including aircraft and shipbuilding, electric cars, telecoms equipment, reinsurance and theme parks. The Ministry of Commerce (MOFCOM) also said it would create a new foreign investment category. Reducing the number of restrictions may not be enough to lure more foreign investors. “We won’t see a significant boost to foreign direct investment with this move,” said Liu Xuezhi, Researcher at the Bank of Communications (BoCom) in Shanghai, adding that the reduced list only applied to the free-trade zones.
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