Aware of a drop in China's foreign investment last year, Xiao Zhuoji, professor of the Economics College of Peking University who is noted for "speaking bluntly", naturally would not keep silent. He said: measures must be taken in light of the current domestic and international situation to end the negative growth of foreign investment.

Xiao put forward several suggestions on improving China's investment environment. "Firstly, it is necessary to enlarge the investment realm. China has a large potential market and a wide range of sectors for investment. Service trades, such as information, finance, and intermediate departments, should be gradually opened to foreign businessmen to provide a broader investment space. Secondly, it is necessary to create new investment methods and gradually adopt globally popular methods, such as mergers, purchase, the reorganization of assets and securities investment. These methods can help greatly simplify the procedures for foreign investment, shorten the time for the transition from investment to the formation of productive forces, and reduce investing costs. They make it possible to combine opening-up with reform, give full play to the role of the resources of existing enterprises and optimize the allocation of resources. Thirdly, it is essential to study the operational law of international capital and open the capital market step by step. In the past decade, we have utilized international capital by issuing B-shares and H-shares, but so far we have not as yet opened the A-share market to foreign investors. Although opening the capital market may involve risks, as long as we intensify supervision, we can definitely keep the risk to the minimum. Fourthly, it is imperative to guide foreign investors to invest in the central and western regions which abound in natural resources and boast many opportunities for development, the government should offer preferential policies as it does in developing the eastern coastal areas. Foreign investors should be guided to participate in the large-scale development of the central and western regions.