China pitches Make in China, key sectors to attract FDI

The Dollar Business Bureau

Xi Jinping, during a session with lawyers from Shanghai at the annual Nation People's Congress (NPC) event, vowed to open up China's economy like never before. In the past few days, multiple Chinese leaders have announced policies that would fast track investment in the economy, including Premier Li Keqiang and Commerce Minister Zhong Shan.

China is desperately trying to find ways to transform its export-dependent economy as the global demand for commodities slows and an uncertain vibe from the developed world's shift to protectionism pervades the world.

The depleting foreign exchange reserves, which slumped below the $3 trillion mark is also of concern to the largest emerging economy. Pre-empting competition from other countries like India which have come astonishingly close to beating China as the top investment destination, China has laid a renewed focus on FDI reform.

Its FDI promotion policy under the 'Made in China' initiative proposes to facilitate easy entry of foreign investors, open up sectors like services, mining and manufacturing, treat foreign enterprises at par with domestic counterparts in licensing and procurement of state projects, provide greater autonomy to states on approval of investments, and allow foreign firm to enlist and issue bonds.

Jinping has pledged to make the investment environment much more conducive and attractive to foreign investors, giving China an edge over its competition in attracting FDI. China's FDI inflows have been posting reasonably good growth (4.1% in 2016 and 6.4% in 2015) despite last year's GDP growth of 6.7%, the slowest since 1990s. A slew of pro-active measures initiated by the government is expected to further improve FDI figures for the year 2017.

As most of the western world turns inwards, the President of People's Republic of China, on multiple platforms, has advocated free trade and liberalisation."China's opening door will not close," Jinping said, as he nears the end of his first term in Chinese Presidency.