China expands list of sectors for foreign investment to 519, focus on manufacturing
- China’s state planner on Friday confirmed 519 sectors will be open to foreign investment from the start of next year, up from 480 previously
- Air ground support equipment, components related to autonomous driving, advanced manufacturing, energy saving and environmental protection are also included
China’s state planner on Friday issued the 2022 list of sectors for foreign investment, which has been expanded to encourage foreign capital to flow into manufacturing sectors in a bid to improve industrial and supply chains.
The new list, with the number of industries expanding to 519 from 480 in the last publication of eligible sectors in 2020, came after President Xi Jinping called on China to “win the battle” in core technologies during the recently concluded 20th party congress.
Still focusing on manufacturing sectors, the new version list remains a “key move to stabilise foreign investment under the current situation,” said a statement by the National Development and Reform Commission (NDRC) on Friday.
“It is not only conducive to promoting a high-level opening up and accelerating the construction of a new development pattern, but also to further stabilising foreign investment, optimising the investment structure and boosting foreign investors’ expectations and confidence.”
China’s foreign direct investment rose by 15.6 per cent from a year earlier in the first nine months of the year to 1 trillion yuan (US$138.12 billion) after 16.4 per cent growth in January-August, the Ministry of Commerce confirmed on Thursday.
“China’s utilisation of foreign capital staged steady progress, but it still faces greater external pressure,” the NDRC statement added.
Foreign investment will be also encouraged in advanced manufacturing, energy saving and environmental protection sectors in China’s central, western and northeastern regions, according to the NDRC.
Foreign investment of equipment manufacturing was supported in Chongqing, Sichuan, Hubei, Hunan and Shaanxi.
In order to give full play to the advantages of labour forces, labour-intensive processing trade industries were particularly encouraged in provinces of Jiangxi, Anhui, Henan, Gansu as well as regions of Guizhou, Ningxia and Guangxi.
The 2020 list will be replaced by the newly announced version from January 1.
China’s state planner also said on Friday that it will take measures to ensure “reasonable” production of polysilicon, as it seeks to support further development of the solar sector.
China produces most of the world’s supply of polysilicon, a raw material to make solar panels, whose price has surged this year because of short supply.
In a notice on measures for the healthy development of the solar industry supply chain, the NDRC said it was necessary to ensure the supply of raw materials for polysilicon production and “fully guarantee” power needs for producers.
It also said it will encourage producers to “reasonably” control polysilicon product prices, while strengthening supervision of the industry and of behaviour such as hoarding that drives up prices.