China is lifting all restrictions on foreign investment access in the manufacturing sector from November 1 onwards. The 2024 version of the negative list for foreign investment access reduces the number of restrictions from 31 to 29 to achieve zero restrictions in the manufacturing sector.
<img src='https://news.cgtn.com/news/2024-11-01/China-lifts-all-restrictions-on-foreign-investment-in-manufacturing-1yb5QeiYXKM/img/d7c48b20c32b450c8014e34b8b51a11b/d7c48b20c32b450c8014e34b8b51a11b.png' alt='International buyers tour the Intelligent Manufacturing Hall at the 136th Canton Fair, in Guangdong Province, China, October 18, 2024. /CGTN'
The two newly opened areas for foreign investors are printing publications, applying traditional Chinese medicine processing techniques and producing proprietary confidential prescriptions for Chinese medicine.
The time-honored traditional Chinese medicine industry is seen as a unique “treasure” of the Chinese nation. So, is the industry ready for an influx of foreign investment?
<img src='https://news.cgtn.com/news/2024-11-01/China-lifts-all-restrictions-on-foreign-investment-in-manufacturing-1yb5QeiYXKM/img/396e3bbc624a46bb8d60955fbaf7e1f9/396e3bbc624a46bb8d60955fbaf7e1f9.png' alt='Zhao Deng, manager of the International Trade Department at Mayinglong Pharmaceutical Group, introduces the company’s best-selling products. /CGTN'
Zhao Deng, a manager from Mayinglong Pharmaceutical Group’s international trade department, said the company welcomes foreign investment in the traditional Chinese medicine market.
He said the company is quite confident in competing with foreign-invested enterprises, noting that its 400-year history and success are rooted in ancient prescriptions and teachings.
<img src='https://news.cgtn.com/news/2024-11-01/China-lifts-all-restrictions-on-foreign-investment-in-manufacturing-1yb5QeiYXKM/img/9de0e4a45d974b58b0e0d14d77650494/9de0e4a45d974b58b0e0d14d77650494.png' alt='Wang Jinhui, manager at Guangxi Golden Throat Group, holds business talks with international buyers at the 136th Canton Fair, Guangdong Province, China, October 31, 2024. /CGTN'
Wang Jinhui works for Guangxi Golden Throat Group – a business which ranks among the top 50 traditional Chinese medicine firms in China.
He said the company welcomes foreign investors to enlarge their facilities, rather than their production in China.
Since 2013, China has introduced a negative list system within its free trade zones, marking the start of a gradual process to liberalize foreign investment.
Through several years of reforms, China has achieved a key milestone by fully opening-up the manufacturing sector to foreign investors.
As the world’s top manufacturing hub, China has consistently been a prime spot for foreign investment. As China lifts all restrictions on foreign investment in the manufacturing sector, how will this impact its economy and future development?
Experts said the move is expected to exert a “catfish effect” on the industry.
<img src='https://news.cgtn.com/news/2024-11-01/China-lifts-all-restrictions-on-foreign-investment-in-manufacturing-1yb5QeiYXKM/img/1ff04e660bfe4c87a546b194ab771dee/1ff04e660bfe4c87a546b194ab771dee.png' alt='Cao Zhongxiong, assistant president of the China Development Institute and director of the Digital Strategy and Economic Research Center. /CGTN'
“Since there’s a catfish in the water, right? It will indeed bring about certain challenges and competition. However, it is also beneficial in that it forces our enterprises to accelerate their pace of innovation, pushing them to improve,” said Cao Zhongxiong, the assistant president at the China Development Institute.
According to the Chinese Ministry of Commerce, in the first nine months of the year, the actual use of foreign capital in the manufacturing industry amounted to approximately 179 billion yuan ($25 billion), with high-tech manufacturing accounting for over 77 billion yuan, an increase of 1.5 percent compared to the same period last year.
Cao emphasized that in the process of opening-up, China provides a better and fairer environment for various industries and funds worldwide. By doing so, foreign investment can fully benefit from the Chinese market in a more open environment.
To better serve foreign investors, China says foreign investors will receive equal treatment in terms of production factors, licensing, standards and procurement. The country will also encourage investment in advanced manufacturing, technology, energy and environmental protection.
