Foreign Companies and China's Economy Will Grow Together in 2020

Foreign Companies and China's Economy Will Grow Together in 2020

In 2020, the actual use of foreign capital in non-financial sectors across the country was 999.98 billion yuan, an increase of 6.2% year-on-year, and the scale reached a record high. The total amount of foreign investment, the growth rate, and the global share were increased by three. At the moment when global cross-border investment is experiencing a cold wave, this report card brings strong warmth, and China has become a "stabilizer" and "safe haven" for cross-border investment.

"Under the background of a sharp decline in global transnational direct investment, China's absorption and utilization of foreign capital can achieve growth and set a record high. This is a very rare achievement." Professor Sang Baichuan, Dean and Professor of the Institute of International Economics, University of International Business and Economics In an interview with a reporter from China Trade News, this shows that foreign capital continues to be optimistic about China’s economic development prospects and recognizes that as China is committed to promoting a higher level of opening up, as long as it is willing to strengthen investment and trade cooperation with China, it will Get a huge opportunity to grow together with the Chinese economy.

Sang Baichuan analyzed that this is the result of a combination of multiple factors: in the case of the spread of the global epidemic, China has taken the lead in effectively controlling the epidemic, and the Chinese market has become the best choice for international capital to hedge; China's business environment has continued to optimize and is a landmark The incident was the formal implementation of the "Foreign Investment Law of the People's Republic of China" and the "Regulations for the Implementation of the Foreign Investment Law of the People's Republic of China". At the same time, a series of measures to expand market access for foreign investment were introduced, including further simplifying the negative list for foreign investment The degree of liberalization and facilitation of foreign investment; the advantages of China’s large market have become increasingly prominent. With the increase in per capita income in China, the upgrading of consumption, and the adjustment of industrial structure, foreign businessmen have seen that the huge demand potential of China’s consumer market is being transformed into actual demand; Under the turmoil of the global economy, China's economy has maintained a momentum of growth, which makes foreign investors have confidence in investing and operating in China, because only in a fast-growing economy, investment can achieve higher profits.

From the perspective of attracting foreign investment structure, the actual use of foreign investment in the service industry was 776.77 billion yuan, an increase of 13.9%, accounting for 77.7%. The absorption of foreign investment in the high-tech industry increased by 11.4%, and the high-tech service industry increased by 28.5%.

In response, Zhang Yansheng, chief researcher of the China Center for International Economic Exchanges, said: “In the past, more than 70% of China’s absorption and utilization of foreign investment was in manufacturing. In 2020, the service industry will attract nearly 78% of foreign investment. It reflects the continuous optimization of the structure of foreign investment in China and the transformation and upgrading of investment fields. High-tech service industries are more talent-intensive, technology-intensive, and resource-intensive industries, which are targeted at the former national treatment plus negative list The investment environment of the management system is very sensitive, so from this perspective, it can be seen that China has achieved remarkable results in building a new higher-level open economic system and fostering new advantages in international cooperation and competition under the new situation."

Zhang Yansheng said that this also reflects that China's economy is entering a new stage of high-quality development. For example, the high-quality development of manufacturing is actually the deep integration of manufacturing and producer services, and the deep integration of digital technology. Deep integration will generate huge demand for domestic service industries and international producer services, while global service industries If you want to provide services in China, it is a commercial presence and you must invest in multinational companies in the service industry in China.

Sang Baichuan said that China has huge room for development in the process of transformation and upgrading in the fields of high-tech industries and modern service industries. At the same time, it also breeds a large number of investment opportunities. With the continuous expansion of market access, foreign businessmen have seen China's big market. The advantages of China and a large number of business opportunities brought by the transformation and upgrading of the economic structure.

Looking forward to 2021, my country’s prospects for absorbing foreign investment are “optimistic, but there are challenges.” Sang Baichuan said that the reason for optimism comes from China’s process of building a new higher-level open economy, and the foreign investment environment will continue to optimize. The advantages of the market are gradually expanding, and the trend of economic structural transformation and upgrading will continue to develop. These basic disks determine that foreign businessmen will continue to step up their deployment in the Chinese market, so the fundamentals of absorbing investment are stable.

Regarding the possible challenges in absorbing foreign capital, Sang Baichuan said that the main reason is that the global epidemic is still very uncertain, so the outflow of international direct investment will shrink on the whole, and many companies' operating income in their home countries will decline, so foreign investment will also be reduced. Appropriate adjustments will be made. In addition, there are still variables in Sino-US economic and trade relations.

In order to better cope with challenges and stabilize foreign investment growth expectations, Sang Baichuan made several suggestions. First of all, we must seize the opportunity reached by RCEP, accelerate the pace of domestic reform and opening up, and promote the real implementation of RCEP rules, which will help promote closer investment cooperation between China and other RCEP members; second, we must seize the comprehensive investment between China and Europe. Opportunities to complete the negotiation of the agreement, improve the domestic post-border rules in accordance with the relevant content of the agreement, continue to optimize the business environment, provide a better investment environment and more investment opportunities for EU investors, and continue to attract EU high-end manufacturing The modern service industry has increased investment in China to enable foreign investment to continue to play an active role in promoting the upgrading of China's economic structure; it should also fully benchmark the advanced international economic and trade rules, promote fair competition, and increase the degree of liberalization and facilitation of foreign investment.