Worrying news for foreign investors arrive from the Annual Boao Forum for Asia (Hainan). Xinhua released an article last Saturday titled “China to unveil new rules on foreign investment” (10/04/2010). In this news story a deputy minister of the National Development and Reform Commission (NDRC), China’s top economic planning agency, announces that new regulations on attracting overseas investment will soon be issued. These are some of the key messages from the article:
- “China still wants foreign investment in high-tech and services sectors, but polluting and energy-gorging projects are no longer welcomed”
- “The rules would stipulate that China will more actively and efficiently encourage good foreign investment”
- “We welcome foreign investment that is conducive to the transformation of the economic growth pattern”
According to this same source, a press conference to be held on Wednesday by the NDRC, the Information Office of the State Council and the Ministry of Commerce may throw more light on the policy details. I am eager to find out what “good investment” will mean.
This press release has also reminded me of a comment I posted just a few days back on the China Law Blog. In that post, Dan Harris was describing a trend identified by his law firm: “China’s local governments are more often delaying or denying applications for wholly foreign owned enterprises (WFOEs) and joint ventures”. My comment to that was a request to elaborate on that piece of info and I quote myself (comment #3 in that post): “… are those applications denied or delayed because they don’t fall into the currently favoured industries…”
What is your experience on this? Have you experience a change in attitude towards foreign investment?