China Encouraging Foreign Investment

China's State Council has recently issued a statement outlining its guidelines regarding further optimizing the foreign investment environment and intensifying efforts to attract foreign investments.

The guidelines urged to improve the overall balance between domestic and international situations and foster a world-class business environment that is market-oriented, law-based, and internationalized.

They also called for giving full play to the strengths of China's enormous market, making more efforts in attracting and utilizing foreign investment and doing it more effectively to make contributions to promoting high-standard opening up and building a modern socialist country in all respects.

Under the guidelines, 24 specific measures in six aspects have been put forward, according to the State Council.

These aspects include improving the quality of foreign capital utilization, guaranteeing the national treatment of foreign-invested enterprises, strengthening the protection of foreign investment, improving the facilitation of investment and operation, increasing fiscal and tax support, and improving ways to promote foreign investment.

The statement also said that all regions are encouraged to adopt supporting measures in light of local conditions to enhance policy synergy.

The Ministry of Commerce should strengthen guidance and coordination with relevant departments on policy promotion, implement the policies and measures timeously, create a more optimized investment environment for foreign investors, and effectively boost foreign investment confidence. 

As China continues to facilitate communication between the government and foreign-invested enterprises, international companies are seeing tangible benefits and showing more confidence in their development prospects in China.

In its communications and dealings with foreign companies that have needs and concerns, Chinese authorities have always listened and adapted quickly to deliver the best outcomes, said Mirko Turrina, general manager of Goglio (Tianjin) Packaging Co., Ltd.

In May 2022, task forces designed specifically to serve the needs of foreign enterprises operating in China were established by the China Council for the Promotion of International Trade (CCPIT) at local levels across the country.

Last October, the task force in Tianjin reached out to Italian-funded food packaging enterprise Goglio Packaging to learn more about the company's possible problems and needs. So far, the task force has assisted the firm in obtaining industrial product production licenses, as well as visas for senior-level foreign staffers, Turrina said.

The communication process is efficient, Turrina said, adding that it is "a powerful example of the commitment of the Chinese government to advance opening up and optimize the business environment."

Playing a vital role in communication and coordination, the task forces have prompted relevant government departments to respond to or solve more than 5,700 appeals from foreign companies operating in China, according to the CCPIT.

Cargill, an agriculture and food company headquartered in the United States, is another foreign company that has benefited from this mechanism.

"In the process of regular two-way communication, the task force strives to help enterprises solve difficulties," the company said, adding that it is actively expanding its business layout in China to meet the demands of Chinese consumers and contribute to the development of sustainable agriculture in the country.

The European Union Chamber of Commerce in China told Xinhua that the association has maintained close communication with personnel from the task forces, and received extensive support in the extension of preferential policies for foreigners to obtain subsidies.

The "bridge" built by the CCPIT between the government and foreign enterprises has provided timely and strong support for enterprises to cope with the impact of China-U.S. economic and trade frictions and the epidemic, said Liu Zhengfu, director of the research and development department of the council.

Explaining the working mechanism of the task forces, Liu said the task forces at local levels coordinate with corresponding government departments to solve the needs of enterprises. If the matters involve departments at a higher level, such problems will be reported to the CCPIT for further progress in seeking solutions. "Relevant departments are very supportive of the work," Liu added.

A survey conducted earlier this year revealed that the vast majority of foreign-funded companies operating in China were satisfied with the country's business environment.

Nearly 90 percent of the surveyed foreign-funded enterprises expressed satisfaction with the business environment concerning market access, tax payments, dispute settlement and promotion of market competition in China.

About 70 percent of the surveyed foreign enterprises were optimistic about the prospects of the Chinese market in the next five years, and more than 90 percent of the enterprises expressed their belief that the attractiveness of the Chinese market will either increase or remain unchanged, according to the survey.

Shayne Heffernan