Cover Story

Investing in China no longer foreign

Updated: 2011-07-01 10:48

By Wang Zhile (China Daily European Weekly)

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In recent years, foreign investors have complained that they have felt hamstrung or pushed out of the Chinese market. Many of them have said that the environment for investments in China is regressing.

That, to me, is absolutely untrue.

Foreign-invested companies have been given equal footing as Chinese companies. Premier Wen Jiabao has repeatedly emphasized that any company established and registered according to Chinese laws is a Chinese company and that they should be treated fairly and equally. In an effort to give foreign-invested companies a more active role in the economy, the Chinese government is currently designating them as Chinese-owned companies.

Perhaps the most glaring example of how the government has helped foreign investors is the document released last year called "Several Opinions of the State Council on Further Utilizing Foreign Capital".

It said China should raise "the quality and level of utilizing foreign capital and do better in giving full play to utilize foreign capital in boosting scientific innovation, industrial upgrading and regional coordinated and balanced development".

In implementing this document, China improves its investment landscape.

The document said the policies to upgrade national industries will include qualified foreign-invested companies. It also said China will encourage qualified foreign-invested companies to cooperate with domestic companies and research institutes to apply for national scientific development and innovation projects.

It is also worth noting in this document that China has focused on the quality, not quantity, of foreign investments. The document denigrated "high polluting, high energy consuming and resource dependent" projects. It also shot down projects that were of poor quality.

With these newly constructed policies, foreign-invested companies should adjust to take advantage of the growing opportunities in China. They should also strengthen their company's social responsibilities. How do they do this? Here are a few suggestions:

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