China will focus on freeing up foreign investment in banking, insurance, securities and futures market trading firms as part of a wider opening up of the services sector, the country’s state planner said in a document released on Friday.
The National Development and Reform Commission (NDRC) did not give any details or time frame on relaxing restrictions for foreign investment in the financial services sector. At a press conference held after the release of the document, Ning Jizhe, vice chairman of the NDRC, said that the government will maintain “some controls”, but did not elaborate.
Businesses that the NDRC earmarked for opening up in the manufacturing sector included rail transportation equipment, motorcycles, edible fats and oils, and fuel ethanol. The NDRC also said China will lift restrictions on foreign investment in unconventional oil and gas production, which usually refers to development of shale deposits.
Industry experts noted China has already allowed foreign companies such as Shell and BP to explore and develop shale oil and gas in joint ventures with Chinese firms. China will also “orderly” open up sensitive areas such as telecoms, education, internet to foreign investment, as well as relaxing foreign investment restrictions on credit-rating services, the NDRC document said.
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The new list of areas marked for liberalisation differ slightly from draft foreign investment guidelines that China published earlier this month. In the draft, restrictions in critical banking and securities sectors remained largely unchanged, though a reference to 49 percent foreign investment caps on some types of securities companies appeared to have been removed.
Beijing is facing mounting criticism from foreign governments over its closed markets. Despite repeated pledges to increase access for foreign firms, critics say it has not followed through on its reform agenda.
A cabinet meeting led by Premier Li Keqiang this week also said China would take more measures to open up and attract foreign investment, for example opening up the country’s manufacturing sector. China’s non-financial ODI is set to surpass foreign direct investment into China by an unprecedented 335 billion yuan this year, according to estimates by the commerce ministry.
Foreign direct investment (FDI) into China rose 3.9 percent to 731.8 billion yuan ($105.53 billion) in the first 11 months of this year from the same period a year earlier.