Investment

by+Zheng+Ran

Utilization of FDI grows steadily and pace of reform and opening up accelerated

Against the backdrop of a severe international investment environment， great diffi culties and challenges from the downward pressure of the domestic economy， Chinas overall absorption of FDI remained stable in 2014， with the quality of FDI utilization being further improved.

The amount of FDI utilization remained stable with the quality being improved. Firstly， the size of the FDI grew steadily. The actually utilized FDI stand at US119.56 billion dollars， up 1.7% year on year. At least 23，778 foreign-invested enterprises were approved， going up 4.4% year on year， revising the tide of decline in two successive years since 2012. Secondly， investment from major countries and regions maintained steady growth. In 2014， the actual FDI in the Chinese mainland from top 10 investors（Hong Kong， Singapore， Taiwan， Japan， the ROK， the U.S.， Germany， the UK， France and the Netherlands） amounted to US112.59 billion dollars， taking up 94.2% of the total， going up 2.7% year on year. Among others， the investment from the ROK and the UK grew rapidly and registered US3.97 billion dollars and US1.35 billion dollars， going up 29.8% and 28% respectively. Thirdly， the indus-trial structures were further optimized and service sectors competitiveness in introducing the FDI got strengthened. In 2014， a total of 15，800 newly-set foreignfunded enterprises in service sector were approved and the actually utilized FDI registered US66.23 billion dollars， going up 14.8% and 7.8% respectively， with its percentage increasing to 66.4% from 55.4%. Fourthly， actually utilized FDI in central China grew rapidly. In 2014， the actually utilized FDI in central China registered US10.86 billion dollars， going up 7.5% year on year.

Reforms on the foreign investment management system were promoted steadily. Active efforts were made to advance Guangdong provinces liberalization of trade in service to Hong Kong and Macao， excluding restrictive measures retained in the agreement， a fi ling system was applied when service providers from Hong Kong and Macao made an investment in Guangdong province， or set up a company or any alteration in the contract and articles approval. A paid-in system on registered capitals of foreign-funded enterprises was changed into a subscribed capital system and the Notice on Improving the Administration of Foreign Investment Review was issued to support the work. Ratification items on confirming the encouraged foreign investment projects were canceled and work was done to simplify fi ling procedures for foreign investment in macro-controlled industries and the real estate industry. We worked with the SCOPSR to carry out the pilot work on regulating and optimizing foreign investment approval， shortening the approval time， simplifying declaration procedures and documents and improving the approval efficiency remarkably. Active efforts were made in China （Shanghai） Pilot Free Trade Zone to conduct the pilot reform on the foreign investment management system， guide the zone to perfect foreign investment filing work and strengthen the under- and post-event regulation.

The pace of opening up was quickened. Efforts were made to further opening up in various fi elds and work in three aspects was mainly done in 2014. Firstly， we worked with the National Development and Reform Commission to revise the Catalogue of Industries for Guiding Foreign Investment， relaxing the restrictions on foreign shares， reducing restrictive items and increasing transparency by large margins. Secondly， work was done with relevant departments to study and issue documents on expanding opening up in medical care， elderly service， e-commerce， education and commercial logistics. Thirdly， active efforts were made to advance the opening up of the service sector under the CEPA framework， with Guangdong province basically realizing its liberalization of trade in service to Hong Kong and Macao. Fourthly， the China （Shanghai） Pilot Free Trade Zone was guided to further shorten the negative list of foreign investment within the zone and the number of items of the special management measures for foreign investment access was reduced to 139 in the 2014 version from 190 in the 2013 version.

Efforts were made to promote the transformation， upgrading and innovative development of the national economic and technological development zones. On the occasion of the 30th anniversary of the establishment of the national economic and technological development zones， we held a work conference on the national economic and technological development zones nationwide. The State Council issued Some Opinions on Promoting the Transformation， Upgrading and Innovative Development of the National Economic and Technological Development Zones， making clear the national economic and technological zonesdevelopment orientation， main tasks and policy measures in the new period. Great efforts were made to enhance the international cooperation on energy conservation and environmental protection， and we have signed MOUs with France， Italy and Finland respectively， advanced to build fi ve ecological parks for international cooperation including the ChinaFrance Shenyang Ecological Park and work on the indicator system construction of ecological parks for international cooperation was done， with a reference guide drafted. The talents training work was given greater support to improve the comprehensive quality and management level of staffs of the national economic and technological zones.

Foreign investment and cooperation in 2014 realizes steady and rapid development

In 2014， in the face of complex and volatile domestic and international trends， Chinas foreign investment and cooperation maintained steady and rapid development and became a highlight of foreign trade and economic cooperation. In January-November， non-fi nancial direct investment overseas totaled US89.8 billion dollars， with an increase of 11.9% year on year. The energy and mineral fi elds continued to be the investment hot spots and the cross-border mergers and acquisitions of agriculture made breakthroughs. The value of newly-signed foreign contracts reached US160.98 billion dollars， with an increase of 12.5% year on year and its turnover was US121.3 billion dollars， with an increase of 10.6% year on year. Large projects in infrastructure construction such as rail transportation increased， which drove the export of home equipment and materials. Foreign labor cooperation sent 498，000 various kinds of staffs with an increase of 63，000. By the end of November， various kinds of staffs overseas reached 1.005 million with an increase of 90，000.

In 2014， all sectors of society paid more and more attention to “going abroad”. The Ministry of Commerce constantly improved all kinds of policy measures and realized developing and running foreign investment and cooperation in a reasonable range focusing on deepening reform， innovating systems， improving service， cultivating environment and protecting rights and interests， etc.

？ Deepen management system reform. The decision on deepening economic system reform by the Central Government was implemented， reform of the overseas investment management system was promoted， the Overseas Investment Management Measures was revised and introduced， the management mode of“filing first and approval second” was established and the regulation that other overseas investment and enterprises except sensitive countries （regions） and in- dustries can fi le was defi ned， the Foreign Direct Investment Statistics System was revised and issued， relevant statistical index was adjusted and improved， foreign labor cooperation and management was strengthened and the standards of petty cash of risk disposition of foreign labor cooperation were improved.

？ Strengthen governmental public service. Country environmental guidance of foreign investment and cooperation for enterprises was enhanced， the 2014 Country （Region） Guidance on Foreign Investment and Cooperation， the 2014 China Report on Foreign Investment and Cooperation Development and the 2013 Country Collection of Investment and Management Obstacle Reports were issued， which have become authoritative information channels for Chinese enterprises to know about the investment and cooperation environment of all countries in the world. The 2014 China Foreign Direct Investment Statistical Communique was released and the information service system of foreign investment and cooperation was improved. Efforts were made to do a good job in policy training of foreign investment and cooperation， building investment and promotion platforms and strengthening publicity and public opinion guidance.

？ Promote practical development of bilateral cooperation. Efforts were made to compile medium- and long-term development plan for foreign investment and cooperation fi elds， promote in-depth development of trade and economic relations between China and relevant countries， actively participate in formulating international rules， accelerate promoting the distribution of free trade zones， pro- mote foreign direct investment in such key fields as agriculture and forestry， conduct transnational and transregional cooperation with Africa in infrastructure， encourage enterprises to implement the construction of such major overseas projects as high-speed rails， railways and nuclear power stations， steadily push forward major peripheral interconnection projects， strengthen inter-governmental cooperation， promote the construction of overseas trade and economic cooperation zones and drive cluster-style “going abroad”.

？ Strengthen overseas risk prevention and control. Efforts were made to strengthen country risk assessment and safety precaution， release safety precaution information， issue the Notification on Further Strengthening the Supervision Work of Safe Production of Overseas Chinese Enterprises， compile the evaluation system of exogenous risk management and control of overseas enterprisesprojects， properly deal with emergencies occurring in Vietnam， Libya， Iraq and some relevant countries in West Africa involving China.

In the near future， Chinese economy will face the “new normal” of steady development and “going abroad” will enter a new development phase of transformation and upgrading and improving quality and increasing benefits. In 2015， the Ministry of Commerce will continue to work with relevant departments to focus on improving development quality and benefits， accelerate cultivating new advantages to take part in international economic cooperation and competition and promote steady and sound development of the business of “going abroad”.