China opens more industries to foreign investment

China announced today it was expanding the number of sectors open to foreign investment, relaxing international ownership caps on brokerages, futures companies and life insurance firms.

The scaling back of the so-called “negative-list” comes as the country works to revive its coronavirus-hit economy, as Beijing pledges to further open-up the economy to international investors.

The number of items on the list of restrictions on foreign ownership has been cut from 40 to 33, said the National Development and Reform Commission (NDRC) in a statement. The number was also reduced last year.

US and European companies, however, have been raising concerns that access to the Chinese market remains tough, and repeatedly complained of unfair treatment.

An NDRC spokesman said Wednesday this shows Beijing’s “determination to expand its opening to the outside world, and China’s firm attitude in supporting economic globalisation”.

Previously, foreign capital in securities companies, futures companies and life insurance could not exceed 51% of the company’s total holdings.

Beijing also lifted regulations prohibiting foreign investment in radioactive mineral production, processing and nuclear fuel production.

It relaxed restrictions on foreign investment in commercial vehicle manufacturing as well.

While it cancelled regulations prohibiting foreign investment in air traffic control, the NDRC statement said that the construction and operations of civil airports must be controlled by China.

In the agriculture sector, restrictions were eased on wheat breeding and seed production. Authorities said Chinese entities had only to hold at least 34%, rather than a majority share.

In the infrastructure industry, China also lifted a rule stipulating the construction and operation of urban water supply and drainage pipeline networks for areas with a population of 500,000 or more must be controlled by the Chinese.

Source: AFP