Caixin
Dec 08, 2016 07:31 PM
POLITICS & LAW

China's Revised 'Negative List' Fails to Impress Overseas Investors

(Beijing) — China's pledge to open up more restricted sectors to foreign companies has not impressed overseas investors, even though the nation's top economic planner and Commerce Ministry announced the number of blocked industries will be reduced by a third.

The National Development and Reform Commission (NDRC) and the Commerce Ministry issued on Wednesday a draft revision of the "negative list," which names those industries inaccessible to foreign companies.

The latest revision of the 2015 Catalogue of Industries for Guiding Foreign Investment cuts the number of restrictions from 93 to 62, opening up markets such as passenger transport, railway equipment, electric-vehicle batteries and lithium mining.

The NDRC said the new list aims to "further improve transparency of policymaking," which "will help build a better business environment and let foreign capital play a positive role in China's economic development, industry transformation, and reform and innovation."

Public comment is being solicited on the draft until Jan. 6.

The draft revision drew a lukewarm response from foreign companies in China, although most of them said they view it as progress.

"Though some of the limited revisions are welcomed by some of our members, the number of openings falls far short of what would be necessary to reinvigorate diminishing foreign industry confidence in the China market," said Jake Parker, vice president of the U.S.-China Business Council, a private organization of more than 200 American companies doing business with China.

The changes to the catalogue might bring new investment in oil seed processing, but "other than that, it is too early to say," Parker said.

Tension between China and its major trading partners, the U.S. and the EU, has mounted in recent years. On Friday, U.S. President Barack Obama blocked a Chinese company's purchase of German chip-equipment manufacturer Aixtron SE on national security grounds, the second outright ban on a foreign acquisition on national security grounds under the Obama administration.

Contact reporter Chen Na (nachen@caixin.com)

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