The elimination of joint venture restrictions and removal of “prohibited” and “restricted” labels for foreign investment in key sectors in the new draft Catalogue Guiding Foreign Investment (CGFI) mark progress for US companies in some sectors in China.
China Market Intelligence
In the face of slowing growth and what policymakers are calling a “new normal” for China’s economy, central planners have stepped up the pace of long-discussed financial liberalizations, from the opening of free trade zones and the Shanghai-Hong Kong Stock Connect to—most recently—the proposed e
In a move that could open up China’s domestic market for foreign electronic payment service providers, the State Council on October 29 said it would give greater access to qualified domestic and foreign companies offering bank-card clearing services.
The opening of China’s long-awaited Shanghai-Hong Kong Stock Connect, a trading link that would allow more foreign investment in China’s stock market, was delayed indefinitely on Monday.
Amid a slowdown in China’s economy and tension between the United States and China on a variety of issues, US and Chinese negotiators are preparing for the upcoming sixth annual Strategic & Economic Dialogue (S&ED) taking place in Beijing in early July.
A new set of State Council measures released earlier this month lays out high-level goals and principles that provide an encouraging framework for economic and financial reforms, though details about the role of foreign investment continue to be vague.
Antimonopoly issues, including M&A reviews and pricing investigations, have garnered considerable attention by US stakeholders in recent months, due to widespread reporting on pricing investigations involving foreign companies and a November 2013 National Development and Reform Commission (NDRC)
Reforms to China’s financial sectors may be advancing in a key area—interest rate liberalization. Depending on its implementation, these reforms could modernize how companies access capital in China and impact the competitiveness of domestic companies that have relied on inexpensive credit.
In 2014, China’s agencies in charge of approving and regulating foreign investment are focused on facilitating a more open economy, creating an open business environment, and lowering foreign investment restrictions, according to various agencies’ 2014 work plans (links to which are provided in the atttached PDF).
In its recently completed recommendations for the Shanghai Free Trade Zone (FTZ), the US-China Business Council (USCBC) urged China’s central and Shanghai’s local governments to substantially reduce investment restrictions, encourage fair and open market competition, and enact equal treatment for foreign and domestic enterprises operating in the zone.