(Yicai Global) July 20 -- Shanghai's government is exploring ways to raise foreign investment opportunities by cutting the pilot negative list, which sets forth those sectors to which foreign investment is either restricted or barred, said Zhang Xinsheng, director of the Shanghai party economic committee, yesterday.
Zhang spoke at a high-level party conference on reforming the Shanghai Free-Trade Zone (FTZ).
The pre-entry national treatment and negative list model is one of the major institutional innovations of the FTZ. Per the provisions of the negative list of non-prohibited investment area, foreign entry permits are needed. Areas outside the negative list are administered based on the principle of consistency of treatment between domestic and foreign investment in the FTZ.
The 2017-version negative list, that took effect July 10, further lifted restrictive measures by shedding 10 entries and 27 measures, thus further opening investment areas and enhancing transparency in foreign access.
By June's end, up to 48,000 new enterprises had set up in the FTZ. Over 8,000 are foreign-funded and more than 95 percent of foreign-invested projects assume the form of record filing outside the negative list, with USD15.4 billion in total now invested.
The cropped negative list and the opening of new industries aim to develop China's economy and expanded opening. Manufacturing and services are major areas for culling these special administrative measures.
The 2017 Industry Guidance Catalog on Foreign Investment will become effective July 28, and further lower measures restricting foreign investment nationwide for most foreign-invested enterprises and provide a more relaxed market environment.
Creating a stable, fair, transparent and predictable business environment is a solid foundation for expanding opening-up.
Foreign capital plays an active role in China's economic development and the process of deepening the reform. In 2015, foreign-funded enterprises accounted for 46 percent, 25 percent, 20 percent and 14 percent of China's import and export trade, industrial output, tax revenue and urban employment respectively.