Investing in China made easy
According to a report by Germany Trade and Invest from November 2018, the conditions for foreign investors in China have never been so good. Current numbers issued by the Chinese Ministry of Commerce attest to this assessment: Foreign direct investment into China grew by 5.5% year-on-year to 19.3 Billion Euro in January and February 2019. Direct investment from Europe increased by 44.3% from 2018 to 2019 in the first two months combined.
China thus remains an attractive location, even if conditions are not easy. Certain industries such as plant and animal breeding, production of media, and wholesale and retail of tobacco were taboo for non-chinese companies up to now. It was not uncommon that those who wanted to get a leg to the ground with a company in China were forced into a joint venture with a domestic company and had to transfer their technology to the partner. Cultural differences then often caused friction when dealing with intellectual property.
BDI, the voice of German industry, published a policy document in January on how to deal with Chinas state-controlled economy. It criticized the market foreclosure and the unequal treatment of foreign investors. Now a turnaround is in sight: The People’s Congress decided with a great majority to further open up China’s markets for foreign investment.
President and party leader Xi Jinping had given the issue top priority and made sure that the law is the one that was adopted fastest in the history of the People’s Republic. One possible reason for the accelerated process is the government’s desire to resolve the trade conflict with the USA as quickly as possible. US president Donald Trump had requested to open the Chinese market for US-investors. He regards equal treatment and market chances as well as the protection of foreign investors‘ intellectual property as a prerequisite to settle the dispute. All this is considered in the new investment law, which will become effective January 1st, 2020. Furthermore, the negative list of taboo industries is going to be revised and abridged.
Critics point out that the law was put together hastily and will observe the implementation thoroughly. The government is going to counter that with a complaint desk.
AchemAsia 2019 is the ideal platform to explore business opportunities in China, reach out to the Chinese process industry and learn about technologies on offer in China.