China Issues New Master List for Foreign Investment Industries

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Last updated at: (Beijing Time) Thursday, March 14, 2002

China Issues New Master List for Foreign Investment Industries

Approved by the State Council, March 11 saw the State Development Planning Commission (SDPC), State Economic & Trade Commission and Ministry of Foreign Trade & Economic Cooperation jointly issue No. 21 order, announcing that the full text of new master list for foreign investment industries and its attachment shall go into effect as from April 1.

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Four catalogs

The new list falls into four catalogs: the encouraged, the permitted, the restricted and the forbidden with a total of 371 articles and clauses.

Features

According to reports, the new list has following features:

It stresses that China will insist on opening up and actively encourage foreign businessmen to invest in China. Clauses on encouraging foreign investors are increased from 86 to 262, clauses on controlling on foreign investment are decreased from 112 to 75.

The list relaxes control on foreign stocks. It has also listed telecom, gas, heat, water supply and drainage and other city pipeline network into the opening-up items to foreigners.

The list has put China's WTO commitments into it.

The list encourage foreigners to invest in China's western regions and release control on stocks and other industries.

The list clauses classify general industry products into permission group in order to promote industry and products upgrading through competition.

Fields encouraged to be invested

In accordance with the new list, China will mainly encourage foreign investors to invest in the following fields:

1, To encourage foreign investors to transform traditional agriculture, develop modern agriculture and promote agricultural industrialization.

2 To encourage foreigners to invest in communications, energy, raw material, infrastructure and other fundamental industries.

3 Electronic information, biology engineering, new material, aeronautics and astronautics and other high-tech industries will also be opened for foreign investors.

4To encourage them to use advanced technology in helping China transform machinery industry, light and textile industries so as to achieve the upgrading of equipment industry.

5 Projects for comprehensive utility of resources, recycled resources, environmental protection and municipal construction will be opened to foreign investors.

6 To encourage foreigners to invest in China's western regions.

7 To encourage the exports of all the permission items

Significance

The new list has been revised after China carried out its "10th Five Year" plan and WTO entry, said Officials with SDPC.

It will be an important guiding policy for China to make use of the foreign investment and also a policy basis for China to approve foreign projects in China.

It is going to play a significant role in promoting further opening-up, attracting foreign advanced technology, improving foreign investment quality, maintaining healthy and sound development of national economy, promoting economic structure adjustment and speeding up system and technology renovation.

Once the new list enters into force, the Temporary Provisions Directory for Foreign Investment issued on December 31, 1997 will become annulled.

Foreign Investment in China Tops 400 Billion US Dollars

China had made use of foreign investment of over 400 billion U.S. dollars by February 2002, the Ministry of Foreign Trade and Economic Cooperation said Wednesday.

By February this year, China had approved the establishment of 393,988 foreign-funded businesses, with contractual foreign investment totaling 756.74 billion U.S. dollars, of which 401.1 billion U.S. dollars had been used, the ministry said.

By PD Online Staff Li Yan

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