Foreign investment in China's state-owned firms expected to increase amid further opening-up

BEIJING, July 25 (Xinhua) -- Foreign investment in China's state-owned enterprises (SOEs) are expected to accelerate and increase, with a series of restrictions on foreign investment in the domestic banking, securities, automobile manufacturing, power grid construction, and other fields to be relaxed or even completely abolished, starting this weekend.

At the end of June this year, China unveiled a shortened negative list for foreign investment, which widens market access for foreign investment in primary, secondary as well as tertiary sectors, detailing 22 opening-up measures in fields including finance, transportation, professional services, infrastructure, energy, resources, and agriculture. The negative list will be effective on July 28, 2018.

Later, the country also released a new negative list for foreign investment in the country's pilot free trade zones (FTZs). The list applies to all FTZs in the country. Compared with opening-up measures detailed in the nationwide list above, the list that applies to the FTZs further removes or loosens foreign access restrictions in the more fields including agriculture and mining.

Experts quoted by the Xinhua-run Economic Information Daily believe that the foreign investment in the domestic SOEs is expected to enter the "fast lane". Major breakthroughs are likely to be made by the foreign investors in the domestic non-bank financial institutions such as securities, futures and insurance, and the automobile manufacturing sector. In addition, the domestic shipbuilding and aircraft manufacturing fields will likely achieve progress in introducing the foreign investment.

Recently, the State-owned Assets Supervision and Administration Commission (SASAC) has also expressed its position to strengthen the openness of state-owned assets to foreign investment, optimize the environment for foreign capital to enter the country, and enhance convenience.

The introduction of foreign investment in the competitive fields can have a positive effect on development of the SOEs at least from two aspects. First, it can speed up the improvement of governance mechanisms, promote the standard operation of the board of directors, and improve management efficiency. Second, it can enhance competitive advantages, provide new channel resources, and deepen the integration of the market and various production factors. (Edited by Hu Pingchao, hupingchao@xinhua.org)