China will lower market access thresholds in areas like the insurance, banking and securities industries and expand the early negative list for management to attract more foreign investments, the State Council has said.
In a notice signed by Premier Li Keqiang and disclosed on Wednesday, the Chinese cabinet says it aims to promote steady growth of foreign investment in China's pursuit of having a more inviting business environment.
The approach to be adopted will be through five main ways:
- lower market barriers
- formulate supportive tax policies
- improve the investment environment in national-level development zones
- facilitate talent mobility
- improve the business environment.
The document, which is a follow-up on a State Council executive meeting on 28 July on the issue, says that market access will also be relaxed in areas like new energy vehicle manufacturing, ship design, aircraft maintenance, gas stations, and artiste booking agencies.
Negative lists for foreign investments, that have been tested in pilot free-trade zones, will be implemented nationwide as soon as possible to enhance openness and transparency.
Preferential tax policies will be formulated, including deferred taxes levied on eligible projects that are invested with profits obtained from foreign-invested companies. No withholding income tax will be levied for these projects.
More visas will be issued this year to foreign talent and more multiple-entry visas that last five to 10 years will be issued to eligible foreigners. A standard work permit system will be introduced in 2018 to attract foreign professionals.
Laws on foreign capital will be improved to guarantee free outflow of profits made by foreign-invested companies. These companies also are encouraged to participate in the merger and reorganisation of domestic companies.
China will improve the protection of intellectual property rights, and raise the competitiveness of the research and development environment, the notice says.
The State Council notice said ministries and related government agencies must draft clear timetables on opening up sectors of the economy. The government has made several statements about further opening its economy to foreign investment, but provided no time frames.