Shorter negative list will open doors wider

China's shortened negative list for foreign investors has reinforced the government's earlier pledges to continue promoting economic opening-up, and will further facilitate foreign entry into the world's largest consumer market despite trade frictions with the United States.

The nation's top economic regulator rolled out the new negative list for foreign investors on Thursday, the latest move in a series of measures in recent months to promote economic opening-up.

The negative list, which further eased or canceled restrictions on foreign investment in a total of 14 key sectors, has come as part of the country's pre-established agenda of continuing to open up its economy to global investors.

Regulatory authorities have set up the agenda to devise the list since the beginning of the year, before the United States started to increase pressure on China and threatened to impose hefty tariffs on Chinese goods as the two countries' trade frictions escalated.

While the final version has been revised several times before being revealed to the public, as the "external environment has been changing on a daily basis", the negative list "meets our own interests and is in line with the government's earlier pledges to continue to promote opening-up", said a National Development and Reform Commission official who asked not to be identified.

Compared with the previous version released a year ago, the new list reduced the restriction categories for foreign investment by 15, to 48, opening up a variety of areas for foreign investors such as transportation, finance, auto manufacturing and energy industries.

The new list is expected to take effect on July 28.

With a specific timetable to open up sectors such as finance and auto industries, the move will be helpful to give foreign investors relatively stable expectations for China's policies, according to an announcement by the commission.

Cui Fan, a professor of international trade at the University of International Business and Economics in Beijing, said that removing restrictions in the service sector is one of the highlights of the new negative list.

Such moves will benefit foreign investors at a time when they have strong interest in participating in China's economic rebalancing, as the nation shifts toward a service-led economy, according to Cui.

Foreign investment in the service sector has already contributed a large share of total foreign capital flows into China, he said.

Before announcement of the full list, some foreign companies had already prepared to knock on the door, as regulators announced some policy liberalization measures earlier this year.

Rating agencies such as S&P Global Ratings and Moody's Investors Service have expressed interest in establishing their own branches in China after central bank Governor Yi Gang announced China's timetable for further expanding financial industry opening-up during the Boao Forum for Asia earlier this year.

Li Gang, deputy head of the Chinese Academy of International Trade and Economic Cooperation, said the government is expected to introduce more detailed measures in different sectors in the second half to make sure opening-up efforts can be thoroughly implemented.