Hainan welcomes foreign investment in select areas
Authorities in South China's Hainan Province unveiled a negative list of industries on Monday, including energy-intensive sectors that produce heavy emissions and low-end manufacturing. The move will accelerate the building of a world-class free trade zone (FTZ) and attract foreign investment, according to experts.
The negative list is a crucial step to ensure that the Hainan FTZ is able to offer world-class products and services that are green and sustainable, Liang Haiming, dean of the Belt and Road Institute at Hainan University, told the Global Times on Monday.
"The list, which excludes low-end manufacturing, will reshape the development model of Hainan," Liang said. "By showing that Hainan's development model is in line with international standards of low carbon emissions and sustainability, it will be especially important for attracting foreign investment and top foreign talent."
According to the Xinhua News Agency, six industrial categories are banned from making new investments, and two other categories are restricted in terms of size and methods of production.
Hainan was designated as the nation's 12th free trade zone in 2018, and it has been exploring ways to deepen international economic cooperation by improving its business environment. As of now, 358 new policies are under development to improve the local business environment, including digitalization of business registration, Shen Danyang, vice governor of Hainan Province, said on Monday during a press conference.
These policies have significantly increased Hainan's appeal to foreign investors. Liu Cigui, Party secretary of Hainan, said that the province's new foreign companies are up 189.2 percent so far this year compared with 2018, and the actual use of foreign capital was up 565.6 percent. Total trade was up 37.4 percent.
The marked growth in foreign economic cooperation was attributable to the preferential policies and Hainan's position to bridge China and the Pacific and Indian Ocean regions.
Hainan is now strengthening its ties with BRI countries that offer huge market potential, Shen said.
"Compared with the other 11 FTZs, Hainan has a weaker industrial foundation and a lack of existing market entities," Liang said. "But that is also one of Hainan's appeals. It is a testing ground that allows bolder experimentation, and it has potential to build a high-end industry chain from scratch."
Since January to August, 138,000 market entities have been added in Hainan, increasing 50.7 percent compared with the previous year. The government has also established a bureau to cut down traditional red tape and make it easier for foreign investors to invest in Hainan.
