State Council strives to make foreign investment smoother

16:56, July 05, 2010      

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The State Council recently published a document called the "20 Views of the State Council," which laid out guidelines for streamlining the approval process for foreign investment projects.

The "20 Views of the State Council" states that promising projects involving a total investment of less than 300 million U.S. dollars based that meet government guidelines, with the exception of projects that are required to be approved by relevant authorities of the State Council, should be approved by the local government authorities. However, experts believe optimizing the investment environment is more than just the delegation of authority.

Administrative inefficiency has always plagued many foreign investors in China. For example, an officer of a company once had to repeatedly rush between the approval department in Beijing and his company if the investment was large and the company was not located in Beijing. Therefore, receiving approval became a time-consuming, laborious and costly issue. However, the new rules of the "20 Views of the State Council" have made it possible for most foreign enterprises to complete relevant procedures at local approval departments.

The Ministry of Commerce canceled and delegated 26 categories of examination and approval in 2009. There were 23,400 newly-established foreign enterprises in China in 2009, 56 of which needed to be approved by the Ministry of Commerce, only accounting for 0.2 percent.

Simplifying examination and approval, lowering the threshold and smoothing the channels are steps that are welcomed by foreign merchants.

"Incredibly, It only takes 45 minutes for the company to obtain approval from the National Development and Reform Commission to receive business licenses," said Wei Qiyan, general manager of the Programme Contracts Division of the Taishan Nuclear Power Joint Venture.

Until now, the State Administration for Industry and Commerce has granted 356 local industry and commerce administrations the right to approve foreign enterprise registration applications. In central and western China, 42 municipal and local industry and commerce administrations were granted the right to approve foreign enterprises' registration applications, bringing more convenience for foreign enterprises to invest in central and western China.

The "20 Views of the State Council" on the "Guidance Catalogue of Foreign Investment Industry" stipulates that the various foreign investment modes should be used and promoted, and the industry and commerce administrations should further formulate rules to support foreign investors' entry into the new-energy, new material, new medicine and other strategic emerging industries through share investment, share pledges and the capital gained as a result of realizing the advanced technologies included in intellectual property rights.

Experts pointed out China currently remains the most important transfer destination in the world's industrial chain, and the future transfer centers will be the premium manufacturing industry, regional R&D centers and the modern service industry. China's optimization of foreigners' investment environment is not just limited to relaxing the approval rights, but also improving the soft environment in terms of system, mechanism, concept and policy.

Efforts will be further strengthened to make reforms and for innovation so as to build a more open and better investment environment and help transform the economic development mode through foreign investment service.

By People's Daily Online


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