Tourists admire the skyline view of Lujiazui area at the Bund in Shanghai, east China, Jan. 6, 2020. (Xinhua/Wang Xiang)
China once again shortened its negative list naming sectors that are off-limits to foreign investors in its steadfast opening-up moves, injecting certainty into an uncertain global economic environment.
The new list saw a reduction in number of sectors in which foreign investment is not allowed from 40 to 33. China has shortened the list for four consecutive years.
It underlines China's image as a staunch supporter of globalization and free trade even when the world economy is severely impacted by COVID-19.
According to the United Nations Conference on Trade and Development, global foreign direct investment flows are forecast to decrease by up to 40 percent in 2020 due to the pandemic.
Hit by the epidemic, foreign direct investment into the Chinese mainland fell 10.8 percent year on year in the first quarter of 2020.
While sentiment on investment liberalization in many parts of the world has faded, China does not erect walls of protectionism, but resorts to further reform and opening up, strengthening confidence and policy consistency in a year of tumult and volatility.
The new list is expected to improve business environment in China, draw more multinational companies from all over the world to invest in the country more efficiently, promote the gradual stabilization of global trade and investment, thus helping offset the negative impacts of the epidemic and enhancing economic vitality. It is in the interests of China and the rest of the world.
The COVID-19 pandemic will not change the China's role as a hot investment destination with a flexible and robust economy, according to Ker Gibbs, president of the American Chamber of Commerce in Shanghai (AmCham Shanghai).
The package of measures the country has rolled out to lure and support foreign investment will help secure its role as an investment magnet, he said.
A recent survey by AmCham Shanghai showed that in the short term, over 70 percent of respondents had no plans to relocate the production and supply chains from China due to COVID-19. In the long term, around 40 percent of respondents said they will keep their supply chains in China, while 52 percent said they had no plans to move out.
Doomsayers spreading talk of mass exodus of foreign investment from the Chinese market will only find that they were rumormongering again.
China's comprehensive supply chain, sound infrastructure and opening-up efforts are attracting more foreign companies to stay and invest in the market for the long term.
The COVID-19 pandemic is still biting into the world economy, and its fallout on the Chinese economy has not gone away. Facing risks and challenges, China has continuously deepened reform and taken firm steps for opening up.
However, as the world economy is highly globalized, the pandemic cannot sever communication, cooperation and the deep-seated economic interactions between nations for good. China's determination to promote globalization and free trade should not be underestimated.
Foreign investors have no reason to give up on China's well-established and highly-efficient supply chain, and its large consumer market. It is no fairy tale that foreign investment will continue to thrive in China.
