Over the past 40 years of reform and opening up, multinational companies have invested heavily in China. By the end of 2019, multinational companies had invested in more than one million projects, attracting more than 2.2 trillion US dollars of actual foreign direct investment. It has been proven that the large-scale inflow of foreign capital has led China to participate in the division of the labor system of economic globalization, share the dividends of globalization and promote its rapid economic and social development. At the same time, the multinational companies investing in China have also obtained huge returns in the form of profit. China has become a source of profit for many multinational companies and an important factor in their international competitiveness.

Studies show that foreign-invested enterprises that invested in China early, on a large scale and in a wide range of sectors, such as the automobile, equipment manufacturing, chemical, electronics and information, pharmaceutical and food industries, are growing fastest and have the strongest international competitiveness. According to a survey conducted by the United Nations Conference on Trade and Development (UNCTAD), China has long been one of the most attractive host countries for multinational companies.

In recent years, there has been a protectionist trend in international investment policies. As the COVID-19 pandemic has affected the global economy, many countries have adopted more stringent restrictions and protective measures in their international investment and trade policies. This has led to unprecedented new challenges in international investment flows this year. According to the first quarter forecast by the UNCTAD, the global flow of international direct investment will fall by 30% this year, and the world economy is facing the risk of a sudden disruption of the efficiency system of the global value chain led by multinational corporations.

In response to the impact of the pandemic and to prevent the risk of a sharp decline in international direct investment, China has shown a more open attitude than in the past. Since the beginning of February this year, the Party Central Committee and the State Council have successively deployed a number of targeted policies and measures.

After the outbreak of COVID-19, the facilitation of China's foreign investment policy has been unprecedented.

Equal attention must be paid to flow and stock. China not only actively attracts new flows, but also focuses more on the stock of foreign investment. In response to the impact of the pandemic on foreign-invested enterprises, governments at all levels have established a sound working mechanism to deal with the pandemic, clarified the division of responsibilities, coordinated and solved the individualized problems of foreign-invested enterprises in a one-to-one manner, ensured the external factors of the enterprises, and maintained the stability of the industrial and supply chains. China has also established a foreign-invested enterprise contact system to support the implementation of policies and help enterprises to solve problems, so as to cash in on policy dividends. For the construction and implementation of major foreign-invested projects, China will guarantee main investment factors such as land use, energy use and capital, accelerate the construction progress, and continue to promote the implementation of large-scale foreign-invested projects through methods such as point-to-point.

Create innovative measures to facilitate investment. China will strictly implement the Foreign Investment Law and its enforcement regulations and cancel the approval and filing of the establishment and other alteration items of foreign-invested enterprises by relevant departments to further facilitate foreign investment. Moreover, China will continuously optimize the work process, effectively reduce the burden on enterprises, and further promote facilitation and innovation measures such as single window, multiple regulation integration, and cross-border capital flow.

Effectively protect the rights and interests of foreign-funded enterprises. China will strengthen the establishment of complaint work institutions for foreign-invested enterprises and improve complaint work rules and handling efficiency. We will enhance the protection of the legitimate rights and interests of foreign investors, and implement fair, just, transparent and law-based management measures in the fields of intellectual property protection, compensation for expropriation, technical standard setup, capital market financing, and government procurement. All entities shall enjoy fully equal treatment.

Upgrade and liberalize the carrier. Carrier construction is a window into China's reform and opening up, and a gathering place for foreign-invested enterprises. Currently, China is accelerating the construction of various carriers. The number of free trade zones, free trade ports, economic development zones, high-tech zones, and comprehensive protection zones has surpassed 2,000.They feature complete functions, orderly division of labor, and an optimized layout, making China a new destination for multinational company investment. At the same time, China plans to promote all-round cooperation in regional economic integration, and actively implement strategies to promote large-scale development in the western region, the full revitalization of the northeast, the rise of the central region, the coordinated development of the Beijing-Tianjin-Hebei region, the development of the Yangtze Economic Belt, the integrated development of the Yangtze River Delta, and the establishment of the Guangdong-Hong Kong-Macao Greater Bay Area, as well as building a new open economy in an all-round way.

Strengthen investment support. Promoting investment has always been an important channel for expanding the use of foreign capital. In recent years, local governments at all levels have continued to create innovative investment promotion methods, make full use of information technology, and increase investment support; integrate various resources to promote investment, and carry out targeted activities to promote investment; establish robust foreign investment service information platforms, and implement a variety of regulations and policies, and create instructions and investment project information; integrate different foreign investment service resources and improve the one-stop foreign investment promotion service system.

Economic globalization has been significantly impacted by the pandemic. However, in the long run, cooperation on international economic integration carried out by multinational corporations is a trend that continues to take place. More than 40 years ago, forward-looking multinational companies took the lead, invested in China and shared the huge dividends of China's economic growth. Since then, China has always been a host country favored by multinational companies. Today, world economic development is at a new turning point, and China once again presents new opportunities and prospects for investment by multinational companies.

Source: Nankai University News Network

Article Source: Economic Daily

Version 5, June 1, 2020