Free Trade Zones

Strong attractiveness for foreign companies supported by flawless openness

Employees at work at the Shanghai factory of Tesla Inc. [Photo/Xinhua]

BEIJING — China’s attractiveness to foreign businesses has grown over the past decade thanks to greater market openness and an improving business environment, and it will continue to be a land of opportunity. in a world plagued by uncertainty and volatility.

American automaker Tesla’s Gigafactory in Shanghai hit a new milestone with the roll of its millionth vehicle from the assembly line in mid-August.

German chemicals giant BASF recently commissioned the first batch of plants at its Verbund site in Zhanjiang, southern China‘s Guangdong province. The site, with a total investment of 10 billion euros ($10 billion), will be the largest investment by a German company in China.

Global pharmaceutical company AstraZeneca has announced plans to establish AstraZeneca China regional headquarters in Qingdao, east China’s Shandong province.

Vigorous efforts by multinationals this year to expand their presence in Chinese markets indicate that the country remains a preferred investment destination. After hitting a record high in 2021, actually utilized foreign direct investment in the Chinese mainland rose 20.2 percent year on year to $138.41 billion in the first eight months.

Wang Xiaohong of the China Center for International Economic Exchanges attributed China’s strong appeal to global businesses to the country’s solid progress in building an open economy.

In 2013, China set up its first pilot free trade zone in Shanghai, a test bed for new openness policies. After five rounds of expansion, China now has 21 such zones.

The country’s negative list for foreign investment has been shortened for five consecutive years since 2017, and laws and regulations including the Foreign Investment Law have been enacted to strengthen protection for foreign investors.

According to a World Bank report, the business environment in China has continued to improve.

As China steadily expanded its institutional openness and actively promoted a market-oriented and law-based international business environment, foreign investors could enjoy more opportunities.

For example, in 2018 the country removed restrictions on foreign investment in new energy vehicles. Soon after, Tesla established its Gigafactory, the first wholly foreign-owned car manufacturing company in China, which began construction in early 2019 and delivered its first batch of Chinese-made vehicles within a year.

Going forward, China’s commitment to reform and opening up will remain unwavering.

Han Wenxiu, an official with the Central Committee for Financial and Economic Affairs, said China will make use of its super-large market, expand high-level opening-up and promote the “double circulation” of domestic and international markets.

The 2022 China International Fair for Trade in Services which concluded in Beijing two weeks ago is the latest example of the country’s efforts to promote cooperation and opening-up. Over 7,800 companies joined the show online and over 2,400 companies participated on-site, making it a successful event with 1,339 projects and contracts signed.

In November, Shanghai will host the fifth China International Import Expo, which will bring together more than 280 Fortune Global 500 companies and industry leaders.

Despite a growing trend of de-globalization, China has continued to open up and taken concrete steps to share its development dividends, demonstrating its unwavering commitment to mutual benefits and win-win cooperation, Wang said.