Economic Observer Online
Feb 21, 2012
By Zhu Xiyan (朱熹妍)
Translated by Ma Zheng
Original Article: [Chinese]

Changes to the Foreign Investment Industrial Guidance Catalogue (外商投资产业指导目录) that came into force at the end of January are likely to see new cash flowing into China’s medical sector and heavy industry.

The changes to the catalogue, which were approved last month by the State Council, mean that foreign firms can now fully own businesses operating in those two sectors.

The investment restrictions were also loosened for foreigners in the chemical processing of coal and natural food additives industry.

Officials hope that the changes will revive foreign direct investment, which has posted year-on-year falls for the last three months.

The government hopes to encourage foreign investors to invest in fields such as environmentally-friendly industries, information technology and high-end equipment manufacturing, a representative from the National Development and Reform Commission (NDRC) said.

“The new policy eliminates the requirement on foreign investors [in the medical sector] to operate through joint-ventures”, said an official from the Ministry of Commerce.

A foreign fund manager told the EO that investment terms for the medical care and education sectors had previously been thought of as “unfair [on foreigners],” and predicted that the new policy would see more money coming into those fields.

 
Links and Sources
Bloomberg China\'s Foreign Investment, Trade Outlook \'Grim\', Ministry Says 
Allens Arthur Robinson Focus: China amends its foreign investment catalogue