In a bid to further enhance cross-border trade and investment, China has announced plans to expand high-level opening-up initiatives by optimizing business procedures and enhancing transaction efficiency. The State Administration of Foreign Exchange (SAFE) disclosed on Friday that pilot programs for high-level opening-up policies would be extended across key regions, including Shanghai, Jiangsu, Guangdong, Beijing, Zhejiang, and Hainan.
According to SAFE’s statement, this expansion aims to facilitate compliant cross-border trade and investment for a broader range of business entities, promoting high-quality development through increased openness. The move is seen as a continuation of successful earlier trials and is expected to contribute to stabilizing China’s fundamentals in foreign investment and trade amid the current complex global environment.
The trial expansion encompasses eight measures designed to optimize business procedures and transactions. Notably, when a foreign-invested enterprise engages in domestic reinvestment, the investee enterprises or equity transferors in the pilot areas will not be required to register for domestic reinvestment. Prudent and compliant banks in the pilot regions are encouraged to innovate financial services and independently handle new international trade settlements.
Wang Peng, an associate research fellow from the Beijing Academy of Social Science, anticipates that these measures will have a demonstrative effect, accelerating the development of high-quality opening-up and improving the efficiency of utilizing foreign investment. The innovative measures are expected to cover a broader range of business models, facilitating foreign trade and investment utilization.
The initiative is intended to boost convenience for cross-border trade and investment, lowering transaction costs, according to Hu Qimu, Deputy Secretary-General of the Digital-Real Economies Integration Forum 50. The innovative measures are seen as contributing to realizing China’s strengths in global trade, such as its mega-market scale, comprehensive industrial categories, and extensive application scenarios.
China has been actively pursuing high-quality opening-up, as evidenced by the recent issuance of a general plan by the State Council for advancing institutional opening-up in the China (Shanghai) Pilot Free Trade Zone. The plan aligns with high-standard international economic and trade rules, covering areas from cross-border data transfer to security management.
The Central Economic Work Conference, recently concluded, emphasized efforts to foster new drivers of foreign trade, consolidate overall foreign trade and foreign capital performance, and expand intermediate goods trade, service trade, digital trade, and cross-border e-commerce exports on the opening-up front.
Experts have dismissed recent reports of “foreign capital leaving China” as hyped by some Western media outlets. They emphasize China’s strong appeal for global investors, especially as industries in the country undergo upgrading and transformation. The outflow of some capital may be directed toward mid- and low-end industries, creating opportunities for China to deploy resources for the development of more advanced sectors. China’s continuous efforts to promote high-quality opening-up highlight its vast potential across various aspects.