China’s new ‘negative list’ for foreign investment removes all access restrictions to manufacturing sector

China's National Development and Reform Commission (NDRC) and Ministry of Commerce jointly issued on Sunday the 2024 "negative list" for foreign investment access, as part of the country's latest efforts to promote wider opening-up to the outside world.

The latest version of the negative list will take effect on November 1, according to the NDRC, the country's top economic planner.

Chinese experts said that the further reduction of the negative list - the first in three years - reflects China's ongoing commitment to its opening-up.

The previous version, published in 2021, took effect on January 1, 2022. The total number of items on the negative list, or restricted sectors for foreign investment, has been reduced from 31 items in the 2021 version to 29 in the latest version.

In response to media inquiries about the list, an NDRC official said on Sunday that the new negative list is part of the nation's efforts of further opening-up.

The NDRC will collaborate with industry authorities to conduct more pilot programs in related industrial fields, utilizing platforms like free trade pilot zones and free trade ports.

The NDRC will also continue to optimize policies to promote foreign investment. It is currently revising the catalog of encouraged foreign investment industries, increasing access to the services sector, the official said.

"China's efforts toward opening-up extend well beyond the negative list… This contrasts sharply with the trade protectionism adopted by some developed countries in the West," Li Yong, a senior research fellow at the China Association of International Trade, told the Global Times on Sunday, noting that China is contributing to a cooperative global investment and trade landscape.

The negative list for foreign investment access that took effect on January 1, 2022, includes two versions - the national version and the free trade zone version.

The free trade zone version has achieved "zero" access restrictions for manufacturing. In the national version, only two restrictions remained for the manufacturing sector, involving corresponding rules on publication and printing as well as the application and production of traditional Chinese medicine.

The latest version of the negative list, released on Sunday, removed those two restrictions to the manufacturing sector.

The latest negative list also constitutes the first time that restrictions on foreign investment in the manufacturing sector have been completely removed. Li said that this move demonstrates that, despite being a major manufacturing country, China maintains an open stance with no protectionism in its manufacturing sector.