BEIJING - China has removed all market access restrictions for foreign investors in the manufacturing sector, a landmark move made by the world's second-largest economy as it opens its doors wider.
The new edition of the national negative list for foreign investment took effect on Friday, scrapping the two remaining manufacturing-related items on the previous list.
The items on the latest negative list, which specifies fields that are off-limits to foreign investors, have been further slashed to 29.
Another negative list applied in the country's free trade zones, which are pioneering pilots in opening up practices, achieved zero-restrictions on foreign investment in manufacturing in 2021.
An open manufacturing powerhouse
The new national negative list signifies that China's manufacturing industry has reached a world-leading level of openness, as almost all developing countries impose restrictions on foreign investment in the manufacturing sector, and even some developed economies still maintain certain foreign investment limits in the field, according to a research institute under the National Development and Reform Commission (NDRC), the country's top economic planner.
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For China, the manufacturing industry is the earliest sector to open up to foreign investors, and it is also the most competitive and most closely coordinated sector in terms of global industrial division of labor.
China's manufacturing value added surpassed that of the United States for the first time in 2010, and accounted for approximately 30 percent of the global total in 2023, making the country the world's largest manufacturer for 14 consecutive years.
The country has seen steady foreign investment growth in its high-tech manufacturing in recent years. In the first nine months of this year, the medical equipment and instrument manufacturing industry, as well as the computer and office equipment manufacturing sector, saw actual utilization of foreign investment up 57.3 percent and 29.2 percent year on year, respectively.
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While China's industry has made significant progress in development, overall, it is still at a crucial juncture of "transitioning from being large to being strong and proceeding on an uphill journey", Jin Zhuanglong, China's minister of industry and information technology, said in a July press conference, citing prominent weaknesses in areas like key core technologies and basic industrial capacities.
China will leverage its vast market advantages to support exchanges and cooperation between Chinese and foreign enterprises, and make the manufacturing sector higher-end, smarter, and more eco-friendly, according to the NDRC.
Investment hotspot
As China forges ahead with opening up, the country remains a prime investment destination for foreign firms thanks to its solid economic fundamentals and enormous market.
Multinational companies, out of long-term confidence in the Chinese economy, have continued to expand their presence in the country with fresh investments in both production and R&D facilities.
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In April, German carmaker BMW announced an additional investment of 20 billion yuan (about $2.81 billion) in its production base in the northeastern Chinese city of Shenyang. In September, French industrial giant Schneider Electric completed the second phase of an innovation laboratory park project in Shanghai. The latest such move this week saw US chipmaker Intel announce the expansion of its packaging and testing base in Chengdu in southwest China and a capital increase of $300 million for its subsidiary there.
During his Beijing visit last week, Apple CEO Tim Cook said China's rapid development helped the US tech giant achieve fast and sustainable growth.
Apple, which regards China as an important market and a key partner in the supply chain, is committed to long-term development in China and will continue to increase investment in areas such as supply chain and research and development, Cook said.
The votes of confidence in the Chinese market echo increasing positive feedback on China's widening doors and supportive policies for foreign investment.
About 90 percent of the 400-plus foreign companies surveyed in the third quarter of this year are satisfied with the country's business environment, and nearly 20 percent plan to increase investment in China, up 2.07 percentage points quarter-on-quarter, according to the China Council for the Promotion of International Trade.
Wider doors in services sector expected
After the removal of all restrictions on foreign investment in the manufacturing sector, faster opening up in the country's services industry is on the table.
China has vowed to further shorten the negative list for foreign investment, with market access restrictions in services sectors, such as telecommunications and healthcare to be reduced.
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On the same day that the Chinese government announced the new version of the national negative list for foreign investment, China also announced steps to expand opening up in the medical field, including giving the green light for the establishment of wholly foreign-owned hospitals in some cities like Beijing and Shanghai.
Last month, the country decided to allow foreign investors to operate wholly-owned businesses such as internet data centers and engage in online data processing and transaction processing in certain areas, as part of a pilot program to expand opening up in value-added telecom services.
China's top economic planner has said that it was studying the revision of the industry catalog of sectors encouraging foreign investment, with one of the key focuses being the further expansion of the services sector.
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"What can opening up bring? Of course, it can bring in capital, products, technology and management experience, but more importantly, it introduces a competitive mechanism that compels domestic enterprises to make greater efforts for survival and development," said Cui Fan, a professor at the University of International Business and Economics.
"Through market competition, industry vitality could be boosted and consumers might enjoy better products and services," Cui added.
