China to Further Open Its Economy to Foreign Investments in Insurance, Banking

August 16, 2017

China, facing a possible decline in foreign investment this year, will become more open for international investors and take steps to better protect intellectual property, its cabinet said on Wednesday.

In recent months, the Chinese government has made multiple statements about further opening its economy to outside investment, though details and timetables have been lacking.

A document published on the website of the State Council on Wednesday said that more sectors will be opened to foreign investors, including new-energy vehicle manufacturing, ship design, aircraft maintenance and railway passenger transportation.

No details on those sector openings were provided.

The State Council also reiterated that the banking, insurance and securities industries will be further opened to foreign investment, adding that a firm timeline for changes will be set.

On Tuesday, the commerce ministry said foreign direct investment into China in January-July fell 1.2 percent from a year earlier to 485.42 billion yuan ($72.66 billion).

Foreign businesses in China, as well as foreign governments, have long complained about a lack of market access and restrictive policies that run counter to Chinese pledges to free up its markets.

China will also improve intellectual property protection for foreign investors, the State Council said on Wednesday, reiterating a long-standing pledge and adding that punishments for infringement would be increased.

On Monday, United States President Donald Trump authorized an inquiry into China’s alleged theft of intellectual property in the first direct trade measure by his administration against Beijing.

The State Council said that China will take steps to ensure foreign investors can freely remit investment gains, including profits and dividends, from the country.

Foreign business lobbies say tighter rules in China on outbound capital flows have raised barriers for European and U.S. companies to get money out of the country.

(Reporting by Beijing Monitoring Desk and Elias Glenn; editing by Richard Borsuk)

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