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Fair, open environment holds FDI into mainland steady
Last Updated: 2017-07-14 00:10 | Xinhua
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Foreign direct investment (FDI) into the Chinese mainland was "basically stable" in the first half of 2017, as the government continued to open up the market and seek a fair and transparent environment.

In the first six months, FDI inflow edged down 0.1 percent year on year to 441.54 billion yuan (about 65 billion U.S. dollars), the Ministry of Commerce said in a statement Thursday.

DOWN BUT STEADY

The decline narrowed from the first five months, as foreign investment in June rose 2.3 percent to 100.45 billion yuan.

The number of new foreign-funded companies rose 12.3 percent to 15,053 in the first half, with 2,894 new foreign companies set up last month, according to the statement.

"The FDI volume was basically stable in the first half, and the structure continued to optimize," ministry spokesman Gao Feng said at a press conference.

The manufacturing sector attracted 128.6 billion yuan of foreign investment, up 3 percent year on year, accounting for 29.1 percent of total FDI.

FDI in the service sector reached 309.99 billion yuan, making up 70.2 percent of the total.

The trend for the influx of foreign investment into high-end sectors continued, Gao said.

High-tech manufacturing saw FDI rise 11.1 percent to 34.97 billion yuan, while foreign investment into high-tech services surged 20.4 percent to 64.72 billion yuan.

FAIR, TRANSPARENT MARKET

Steady FDI and growth in new foreign-invested companies in the first half came partly from government efforts to create a fair and transparent environment for all companies.

The 2017 China Business Report unveiled Wednesday by the American Chamber of Commerce in Shanghai said that 77 percent of U.S. companies in China remained profitable last year, up 6 percentage points from 2015, and 73.5 percent reported revenue growth, up 12 percentage points from 2015.

"Sound performance of U.S. companies in China offers strong evidence for the continued improvement in China's business environment," Gao said.

The report also cited the concerns of some companies about China's market transparency.

"I think the worries are totally unnecessary," Gao said.

In recent years, the government has been dedicated to "creating and maintaining a market environment featuring fair competition," he added.

The Chinese government has reiterated the principle of treating foreign companies in China the same as Chinese companies.

"We have matched our action with words," Gao said.

Last month, the government announced that it will use a "negative list" management approach for all foreign investment, open up more sectors and further relax restrictions for foreign businesses.

The nationwide implementation of the negative list approach, which identifies sectors and businesses that are off-limits or restricted, shows "China's more active attitude toward opening up, more inclusive supervision and better services," Gao said.

Starting on July 28, China will also implement a revised foreign investment catalogue, which includes the negative list as well as sectors and industries that the government wants to encourage foreign companies to invest in.

The catalogue shortens the list of sectors that are completely off-limits for foreign investment from 36 to 28.

China also treats foreign companies and domestic companies the same in its reforms to streamline administration, delegate power and improve regulation and services.

"The Chinese government has granted and will continue to grant foreign companies comprehensive and full national treatment," Gao said.

Strong economic performance makes China an ideal destination for foreign investors. The economy expanded by 6.9 percent in Q1, the fastest pace in six quarters.

The market consensus for Q2 growth is 6.8 percent, the envy of most major economies in the world. The actual figure will be released by the National Bureau of Statistics on July 17.

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