General

The Catalogue of Industries Encouraging Foreign Investment (2022 Edition) (hereinafter referred to as the new edition of the Catalogue) promulgated by the National Development and Reform Commission and the Ministry of Commerce the other day shall come into force as of January 1, 2023. The relevant person in charge of the National Development and Reform Commission said that the new version of the Encouragement Catalogue is an important measure to further stabilize foreign investment under the current situation. It is not only conducive to promoting high-level opening up and accelerating the construction of a new development pattern, but also conducive to further stabilizing foreign investment, optimizing the investment structure, boosting foreign investment expectations and confidence, and promoting the development of international trade.

On the basis of maintaining the original policies, the new edition of the Encouragement Catalogue further expands the scope of foreign investment in accordance with the principle of "increasing the total amount and optimizing the structure". The total items of the updated catalogue are divided into 519 national catalogues of industries encouraging foreign investment, 955 in the central and western regions, totaling 1474. It is worth noting that compared with the 2020 edition of the Catalogue, the new edition of the Catalogue of Encouragement has 239 articles added and 167 articles modified; Among them, 200 entries were added and 82 entries were revised in the central and western regions.

"This update of the Encouragement Catalogue timely echoes the reality of China's accelerating industrial transformation and the continuous emergence of new business types in the current economic development." Zhang Jianping, director of the Regional Economic Research Center of the Research Institute of the Ministry of Commerce and member of the Special Committee of the China Council for the Promotion of International Trade, said that with the continuous downsizing of the Special Administrative Measures for Foreign Investment Access (Negative List) and the corresponding increase of the Encouragement Catalogue, it is also conducive for foreign investors to properly grasp the direction of investment in China, enhance confidence and determination, and strengthen the development of international trade.

There are three aspects worth noting in this new edition of the Encouragement Catalogue: First, we will continue to encourage foreign investment in manufacturing. The national catalog continues to take manufacturing industry as the key direction to encourage foreign investment, improve the level of the international trade industry chain supply chain, and add or expand relevant items such as components, parts, and equipment manufacturing. Second, we will continue to guide foreign investment in productive services. The national catalog will focus on promoting the integrated development of service industry and manufacturing industry, adding or expanding items such as professional design, technical service and development. Third, we continued to optimize the regional layout of foreign capital utilization. In combination with the comparative advantages of local labor force and characteristic resources, we will expand the scope of the directory in the central and western regions.

Zhang Jianping said that the GDP of China's manufacturing industry has exceeded 27%, and the scale of the manufacturing industry has kept the first place in the world for many consecutive years. In particular, the manufacturing industry is playing an increasingly important role in driving economic development and participating in international competition. This national catalog continues to take manufacturing industry as the main direction of encouraging foreign investment, and at the same time, it focuses on promoting the integrated development of service industry and manufacturing industry, which means that promoting the high-quality development of manufacturing industry is placed in a more important position, consistent with China's current policy of building a modern industrial system and promoting high-level international trade opening to the outside world.

In addition, with the transformation of social and economic development and the improvement of manufacturing level, China's demand for producer services ushered in a period of rapid growth. "These are mainly reflected in the professional services related to manufacturing industry, as well as transportation, logistics and warehousing, computer services and software. This development trend requires China to guide the flow of foreign capital to relevant fields in a timely manner, so as to promote the optimization of the structure while stabilizing the stock and expanding the increment of foreign capital." Zhang Jianping said.

Productive service industry is an emerging industry that has developed independently from the production service sector within the manufacturing industry, and does not provide direct and independent services to consumers. From the perspective of development stage, some areas of producer services in China have achieved scale effect, such as transportation, logistics, wholesale, retail, finance, commerce, etc., but there is still considerable room for improvement in development quality and contribution rate to economic growth. In particular, in recent years, some new forms of producer services are worth paying attention to, and also need to achieve innovation in the coordinated development of domestic and foreign capital, such as information and data services, scientific and technological services, industrial design, agricultural science and technology, e-commerce, energy conservation and environmental protection services.

In addition, the relevant person in charge of the Ministry of Commerce said earlier that the new version of the Encouragement Catalogue will give full play to the resource endowment and industrial advantages of the central and western regions of China, and continue to guide foreign investment in the central and western regions. In view of the advantages of human resources, new labor intensive processing trade related industries were added in Jiangxi, Anhui, Henan, Guangxi and other provinces and regions; In order to give full play to the advantages of traditional manufacturing, equipment manufacturing and other items have been added in Chongqing, Sichuan, Hubei, Hunan and other provinces and cities; In order to better base on the advantages of agricultural resources, new items such as agricultural and livestock products processing have been added in Heilongjiang, Jilin, Liaoning and other places; In order to improve the development level of export-oriented economy along the border, new items such as trade logistics, tourism and leisure have been added in Tibet, Xinjiang, Yunnan and other provinces and regions.

Zhang Jianping suggested that the Encouragement Catalogue is only an important reference for foreign investment. In the process of attracting investment, various regions should also properly provide corresponding supporting services, strengthen the coordination and linkage between various government departments, establish and improve the one-stop service system for foreign-funded enterprises, so that foreign investors can efficiently and conveniently invest in local areas and grasp the development of international trade.