Japanese Investment in China Shows no Sign of Slowing, Official Says
Xu Wei
DATE:  Dec 10 2020
/ SOURCE:  Yicai
Japanese Investment in China Shows no Sign of Slowing, Official Says Japanese Investment in China Shows no Sign of Slowing, Official Says

(Yicai Global) Dec. 10 -- Most Japanese companies in China are not considering withdrawing from the Chinese market, despite the Japanese government offering them billions of US dollars in subsidies as part of a pandemic aid project to do so, a Ministry of Commerce spokesperson said today.

China has a large-scale market, a complete set of industry supporting capabilities, sufficient human resources and good infrastructure, Gao Feng said. The so-called "need to depend less on China" does not conform to market laws and will not become the basis for corporate investment decisions, he added.

Of the 29,500 new foreign-backed businesses set up in the country in the first 10 months, 604 of these were Japanese, Gao said. This amounted to an investment of CNY20.3 billion (USD3.1 billion) by Japanese firms, he added.

Over 1,700 Japanese enterprises had applied for JPY1.76 trillion (USD16.8 billion) in government aid to move out of China, the Japan Forward reported previously.

WTO, EU

China regrets the paralysis of the World Trade Organization’s Appellate Body, which makes the final judgments on appeals regarding trade disputes between members, and is making unremitting efforts to restore its operation, he added.

The dispute settlement mechanism is one of the core pillars of the WTO, he said. The paralysis has dealt a heavy blow to the multilateral trading system, Gao said.

The Appellate Body has been unable to operate since December last year when it was left with one judge, after two of the three remaining judges came to the end of their terms, well below the minimum quorum of three needed to conduct reviews. The final member resigned last month, giving it a membership of zero. No new appointments have been made since June 2017 due to a lack of consensus among members.

The European Union and China are holding their 35th round of negotiations, and the 10th this year, regarding the EU-China Comprehensive Agreement on Investment, Gao said.

Consumption

The Chinese government will encourage local governments to lift restrictions on car purchases and to give incentives to swap old home appliances and furniture for new, green ones in order to stimulate consumption, he said.

Editor: Kim Taylor

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Keywords:   WTO,EU,Japan,China's Ministry of Commerce