The door of China’s opening to the outside world will not be closed, it will only be opened wider and wider, and the utilization of foreign capital is an important part of China’s high-level opening to the outside world. At present, foreign-funded enterprises not only account for 2% of the total number of enterprises in China, but also contribute 1 / 10 of urban employment, 1 / 6 of tax revenue and 2 / 5 of import and export. It can be seen that China’s efforts in “stabilizing foreign investment” are crucial, and to a large extent, China can get more dividends in the economic globalization.
Of course, these efforts will also enable investors from all over the world to share more development opportunities from China’s economic development. Otherwise, people will not invest in China.
Under the background that the world economy is facing great challenges due to the epidemic situation, the transnational investment of all countries in the world is seriously hindered. Some time ago, the International Monetary Fund once predicted that the world economy will shrink by 4.4% in 2020, while the economies of major economies, except China, will show varying degrees of negative growth. In contrast, due to proper measures, China’s economy was the first to get rid of the epidemic and achieved 2.3% economic growth in 2020.
On November 4, 2020, at the Haian production base of Ximeng Qitong electric, located in Haian economic and Technological Development Zone, Jiangsu Province, workers are producing electrical products on the production line for domestic and Southeast Asian markets. (source: Oriental IC)
Reasonable economic growth means more opportunities for return on investment, so China naturally becomes the preferred choice for international investors. In June 2020, the United Nations Conference on Trade and development predicted in the “World Investment Report 2020” that the global FDI flow in 2020 will be reduced by about 40% from that in 2019, reaching the lowest level in nearly 20 years. However, China is not “following the trend” in the utilization of foreign capital at this time.
According to the data disclosed by China’s Ministry of Commerce, in 2020, the actual use of foreign capital in non-financial fields nationwide reached 999.98 billion yuan, a year-on-year increase of 6.2%, equivalent to 144.37 billion U.S. dollars, a year-on-year increase of 4.5%. Not only the scale reached a new record, but also the total amount of foreign capital, growth rate and global share of “Three Promotions” were realized.
At the present time when the world economy is generally depressed due to the epidemic situation, China’s remarkable success in utilizing foreign capital can not be separated from a series of measures taken by us to overcome the problems caused by the epidemic situation, such as adopting flexible means such as online promotion, online investment promotion and online contract signing. However, to a greater extent, these successes are due to the implementation of its own opening-up policy A bit.
On April 10, 2018, Chinese President Xi Jinping stressed in the keynote speech at the opening ceremony of the Boao forum for Asia, that China will take four major initiatives to expand market access, create more attractive investment environment, strengthen intellectual property protection and take the initiative to expand imports, and the first two initiatives are most direct in terms of China’s foreign capital utilization. Pick up.
On October 19, 2019, in the new area near the port of Shanghai, the Tesla super factory after the completion of the main aerial project is as grand as a “land aircraft carrier”. (source: Oriental IC)
On the one hand, in terms of expanding foreign investment access, with the birth of China’s Shanghai pilot Free Trade Zone in 2013, the negative list management mode, which highlights the characteristics of “can be done without prohibition”, is more and more widely used in China, which is not only more transparent, but also consistent with the international practice.
Initially, the negative list of the pilot Free Trade Zone included 190 restrictive measures. However, from the negative list of foreign investment access of the national version, the pilot Free Trade Zone version and the Hainan free trade port version so far, there are only 33, 30 and 27 restrictive measures respectively. There are no special restrictive measures for foreign investment projects in other fields.
On the other hand, “stabilizing foreign investment” depends not only on expanding the access scope of foreign investment, but also on whether the business environment is suitable.
According to the global business environment report of the world bank, from 2018 to 2020, China’s business environment ranks 78th, 46th and 31st among 190 countries and regions respectively, indicating that China’s business environment has improved significantly.
The rise of the above ranking can only show the improvement of the business environment from the perspective of “software”. In the past year, more “hardware” carriers have played a supporting role in the improvement of China’s business environment. In addition to 21 pilot free trade zones and Hainan free trade port, there are also national level new areas, economic and technological development zones, high-tech industrial development zones, comprehensive bonded zones and service zones Comprehensive demonstration zone for business opening, comprehensive pilot zone for cross-border e-commerce and other parks.
“Stabilizing foreign investment” is not only an arduous task, but also a complex system engineering. Therefore, it is far from enough to rely on our own efforts. We also need to let foreign investors recognize the series of efforts we have made. In this regard, protecting the legitimate rights and interests of investors can be said to be a prerequisite for the smooth development of the work of utilizing foreign capital.
On March 15, 2019, the second session of the 13th National People’s Congress voted and passed the new version of the law of the people’s Republic of China on foreign investment. Some of its provisions can be said to be “reassuring” for foreign investors. For example, the state does not impose a levy on foreign investors’ investment; administrative organs and their staff are not allowed to use administrative means to forcibly transfer technology; there is no law or administrative system According to the laws and regulations, the legitimate rights and interests of foreign-invested enterprises shall not be impaired or their obligations shall not be increased, market access and exit conditions shall not be set, and normal production and operation activities of foreign-invested enterprises shall not be interfered with.
Faced with the uncertainty of the external environment, these “reassurances” will help foreign investors enhance their confidence in investing in China. According to a recent survey conducted by the Ministry of Commerce, nearly 60% of foreign-funded enterprises in China will achieve growth or even profit in 2020, and nearly 90.5% of them are optimistic or cautiously optimistic about the future.
It is worth noting that China’s success in “stabilizing foreign investment” in the past year is not only reflected in the scale, but also in the quality of attracting foreign investment. In the era of innovation driven, the quality of foreign investment will be more reflected in the technical content of foreign projects. In 2020, China’s high-tech industry will absorb 11.4% foreign investment, and the high-tech service industry will absorb 28.5% foreign investment, which is higher than the overall growth rate of the actual use of foreign investment in non-financial fields in the same period.
On December 2, 2020, the announcement ceremony of Mercedes Benz heavy truck localization plan with the theme of “made in China, exclusive to China” was held in Beijing, marking the official landing of Mercedes Benz heavy truck localization. According to the domestic market demand and based on the latest and most advanced technology platform of Mercedes Benz heavy truck, the project will create exclusive heavy truck products in China, which is expected to be officially put on the market in 2022.
At the same time, the level of investment is also reflected in the specific project. In 2020, the large projects invested by ExxonMobil, Daimler, BMW, Toyota, LG and other multinational companies in China can also be said to be the finishing touch of “stabilizing foreign investment” at a high level.
In this sense, if the former “stabilizing foreign investment” focuses on stabilizing the scale of foreign investment, the future “stabilizing foreign investment” will focus more on pursuing the double stability of the scale and level of foreign investment utilization, especially on opening wider space for foreign investment utilization by upgrading the level.