On Wednesday, China made public a fresh action plan aimed at stabilizing foreign investment, which encompasses 20 specific measures in four key aspects.
One of the measures is to Facilitate the ease of personnel exchanges. It is to speed up negotiations on mutual visa exemption agreements and keep steadily broadening the scope of countries eligible for unilateral visa exemption. Also, policies on port visas, transit visa exemptions, and regional entry visa exemptions will be optimized to boost cross – border movement of people. Additionally, the ‘Guidelines for Foreign Business Personnel Working and Living in China’ will be updated.
The other measures involve further expanding market access across various sectors and ramping up efforts to promote investment.
According to a notice released by the General Office of the State Council on Wednesday, the action plan was formulated by the Ministry of Commerce (MOFCOM) and the National Development and Reform Commission.
Within the framework of these measures, the plan will encourage foreign companies to make equity investments in China and guide high – quality foreign capital towards long – term investment in China’s publicly listed companies.
The plan also stipulates that China will remove restrictions to allow foreign investment companies to use domestic loans for equity investment, encourage multinational corporations to set up investment companies, and simplify the process for foreign investors to conduct mergers and acquisitions in China.
Some experts pointed out that these measures will widen the channels for foreign investment, enhance flexibility, and support larger – scale investment in the country.
Xi Junyang, a professor at the Shanghai University of Finance and Economics, told the Global Times on Wednesday that the relaxation of foreign investment restrictions is in line with China’s continuous drive to promote high – level opening – up.
Xi noted that the measures related to equity investment in China hold great untapped potential. “Compared with traditional investment methods like setting up joint ventures in China, equity investment offers more flexibility, enabling foreign investors to participate more comprehensively and on a larger scale in China’s growing economy,” Xi elaborated.
According to a Reuters report on Wednesday, Morgan Stanley stated in a prime brokerage note that although hedge funds have increased their holdings in Chinese stocks to the highest level in a year, the current levels are still relatively low by historical standards.
Experts believe that there is still ample room for growth in foreign investment, especially as China’s technology sector continues to prosper and new investment opportunities emerge.
Xi said that the improved investment conditions and China’s rapid economic development continue to make the country an appealing destination for foreign capital.
To further expand market access for foreign investment, the new action plan also advocates expanding pilot programs in sectors such as telecommunications, healthcare, and education, and enlarging the scope of industries open to foreign investment. The plan also emphasizes that in sectors not on the negative list, foreign companies will be subject to the same regulatory standards as domestic ones.
Bian Yongzu, the executive deputy editor – in – chief of Modernization of Management magazine, told the Global Times on Wednesday that the new action plan not only bolsters China’s economic development but also underlines its commitment to globalization. As China opens up, it will facilitate global investment, which is crucial for global economic growth.
Foreign investment in China has shown signs of improvement. Data from the MOFCOM released on Wednesday indicated that in January, China’s actual use of foreign direct investment (FDI) reached 97.59 billion yuan ($13.4 billion), a 13.4% year – on – year decrease but a 27.5% increase from the previous month.
Meanwhile, the actual use of FDI in the high – tech manufacturing sector totaled 12.24 billion yuan, accounting for 12.5% of the total FDI, an increase of 0.8 percentage points compared to 2024. In terms of the sources of FDI, those from the UK surged by 324.4%, and those from South Korea soared 104.3%, according to the data.
Chinese officials have also been encouraging foreign companies to invest and develop in China. On Wednesday, Ling Ji, the vice minister of commerce, met with Lucian Boldea, the president and CEO of Honeywell Industrial Automation. Ling emphasized China’s strong economic resilience, innovation, and efficient supply chains as the key factors supporting the long – term, stable growth of multinational companies in the country. He welcomed Honeywell’s continued investment in smart manufacturing and green low – carbon sectors, as stated in a MOFCOM release.
Boldea, as per the MOFCOM statement, expressed Honeywell’s confidence in the Chinese market, highlighting the company’s 40 – year presence in China. Despite external uncertainties, he said that Honeywell is dedicated to increasing research and development investment and participating in China’s green transition, providing high – quality products and services to the Chinese market.
