According to Tianjin Commission of Commerce, the city established 726 new foreign-funded enterprises in the first three quarters of 2017, using 7.98 billion U.S. dollars of foreign investment, 4.9 percent more than in the same period of the previous year. Among them, 96 were established in September, using 920 million U.S. dollars, increasing by 4.4 percent year on year.
Industry insiders say that there are some unfavorable factors for Tianjin's use of foreign capital, including the stern situation in the domestic and overseas economy, the international competition and the rising operating cost of domestic enterprises.
Besides, the competition with other provinces and cities has become fiercer. In the first two years of operation, the pilot free trade areas benefited from the dividends of the innovative policy and systems and as a result it gathered a number of foreign-funded enterprises. With the increase in the pilot free trade zones in other areas of the country, from 4 to 11, the advantage of Tianjin's free trade zone has been weakening. The general scale of using foreign capital by the city has kept a rapid growth in the recent years mainly by relying on the service trade dominated by financing and leasing. As the country spread the practice of shifting from examination and approval system to the system of putting on record, the financing and leasing by foreign capital has been changed into putting on the record nationwide, with the access formalities greatly simplified. The situation that overseas capital financing and leasing enterprises were mainly concentrated in the four pilot free trade zones has changed.
Compared with cities in the middle and western parts of the country, Tianjin has relative high cost in housing rents, labor and other production factors and there is a gap in industrial matching abilities with Guangdong and other advanced regions. At the same time, Tianjin is greatly affected by smog and other environmental pollution and it has a big pressure to bear upon the environment. In recent years, it has strengthened management of polluting enterprises and that has, to a certain extent, affected part of the multinational investment enterprises to continue investing in Tianjin.
Yan Bing, deputy director of the International Economics Institute of Nankai University said that in order to further attract foreign investment, it is necessary to create a better environment for doing business in the city, continue to delegate administrative powers, combine delegation of power with control and optimize services, lower institutional trading cost to realize mutual benefit and win-win. Tianjin should make greater efforts to adjust the policies toward foreign investment in following aspects.
First, it must create a new foreign capital management system. While pushing forward the institutional innovations in the pilot free trade areas, it should accelerate the pace of deepening the reform of the administration, investment, trading and financial management system that may be duplicated and spread. It should make efforts to expand the opening up of such services in finance, education, culture, maternal and child care, old-age care, accounting and auditing, project designing, commercial and trade logistics and e-commerce. It should improve the pre- and post-investment monitoring and management and build a sound investment filing and information reporting system to push the sharing of departmental information and coordinate monitoring and management and improve the mechanism for protecting the rights and interests of investors.
The second is to deepen investment promotion for the high-end cluster chains. It should direct foreign capital to invest in high-end manufacturing, the new generation of information technology, aviation and space, energy conservation and new energy automobiles, new materials, bio-medicine and high performance medical equipment, new energy, energy conservation and environmental protection, modern petroleum and chemicals and modern metallurgy, with the aim of building a nationally advanced manufacturing R&D center. In adgdition, it must have enterprises and projects upstream and downstream to match up the advanced technologies. It should launch a project for attracting the world top 500 to invest in Tianjin, introducing a number of advanced manufacturing and modern service projects. It should push small technology giants to cooperate with hidden champion enterprises in Germany, Japan and the United States. It should implement the plan of execution for the synergetic development among Beijing, Tianjin and Hebei Province, actively accepting foreign-funded high-end projects transferred from Beijing.
The third is to optimize utilization structure of foreign investment. With the aim of building north China international shipping core area, the city should attract internationally known large shipping corporations, international shipping agencies, shipping financial insurance organizations, shipping brokerages to develop in Tianjin. It should expand the service areas for foreign investment, directing foreign capital to invest in modern commerce and trade, cultural creation, tourism, conferences and exhibitions, education and sports, accounting and auditing and maternal and child care and old-age care and other modern services. It should make full use of the resources of service cluster areas and building cluster areas. It should organize special investment promotion activities to attract foreign investment toward the designated areas, thus forming the cluster effect in the service industry. It should encourage foreign investors to participate in developing modern agriculture, eco-agriculture, high value-added planting and breeding industries and deep-processing of agricultural products.
The fourth is to attract both capital and technology. In line with the "Made in China 2015" and "Internet +" strategy, the city should expand the areas in equipment manufacturing, smart manufacturing and industrial Internet for using overseas investment. It should encourage foreign investors to invest in building public technology platforms and corporate technology centers, accelerate the building of high-rises and mass innovation platforms and introduce the regional headquarters of a number of multinational corporations, functional organizations and innovative enterprises and projects. It should encourage multinationals to build strategic cooperative mechanisms with local enterprises and jointly invest in R&D organizations.
The fifth is to create new ways of using overseas capital. It should encourage overseas capital to get involved in the mixed ownership transformation of state-owned enterprises by way of strategic investment, equity investment and share participation and acquisition. It should support companies listed on the A-share market to attract overseas strategic investors to make enterprises to get a listing overseas. It should relax the market access in public services and support overseas capital to get involved in building public services and infrastructural projects.
A single purchase
