Development of Hainan free trade zone to be accelerated

China will continue to accelerate development of free trade zones with more incentive policies to encourage foreign investment this year, in a bid to promote high-level opening-up, according to the Ministry of Commerce.

The ministry released a notice on Friday, reiterating the resolution to stabilize foreign trade and investment as the COVID-19 pandemic has posed severe challenges to the global economy.

It said market access for foreign capital will be continuously widened by shortening negative lists that identify sectors where foreign capital is restricted, and expanding the catalog of industries where foreign investment is encouraged.

Manufacturing, high-tech, energy conservation and environmental protection, as well as service industries are some of the fields expecting to attract more foreign investors.

Pilot free trade zones should play a bigger role in pioneering opening-up backed by more policies benefiting foreign trade. Development of the Hainan Free Trade Port will be boosted, it said.

Dong Debiao, general manager of global auditing and consulting firm Deloitte China’s Hainan office, said the Hainan Pilot Free Trade Zone boasts a vast market that will facilitate the company’s innovative projects.

Encouraged by favorable government policies, in January the firm established its Hainan regional headquarters in Sanya. In addition to Deloitte, a number of multinationals such as Coca-Cola, GLP Group and Temasek Holdings have invested in the Hainan FTZ.

Dong said Deloitte would provide professional services to support the development of the Hainan FTZ and free trade port in fields including creating a world-class business environment, carrying out global investment cooperation and improving government service capabilities.

Wei Jianguo, vice-president of the Beijing-based China Center for International Economic Exchanges, said in order to adapt to the changes brought by the COVID-19 pandemic, it is significant for China to take a lead in constructing the free trade zones that play a key role in attracting foreign investment, especially big-ticket projects.

“Many foreign investors will pay more attention to China’s overall institutional advantages, as the country has done well in virus control,” Wei said, adding that China’s effective measures proved that the market is the best place to protect foreign investment.

Zhang Yansheng, a senior researcher with the China Center for International Economic Exchanges, said since the introduction of reform and opening-up, China has been ramping up efforts to liberalize market access for foreign companies, and significantly improve the country’s investment environment.

Opening the economy wider is conducive to protecting the legitimate interest of foreign companies and to stabilizing foreign investment, Zhang said.

According to the notice, the ministry urged efforts to facilitate resumption of work at foreign companies with targeted measures to address their difficulties, and further advance major foreign-invested projects.

It also stressed innovative methods to attract foreign capital such as through major fairs and exhibitions and online channels, optimizing the business environment and government services.

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