China's economy will open up like never before, says President Xi Jinping
Amid shrinking foreign exchange reserves and rising competition in foreign investment from countries like India, Chinese President Xi Jinping on Sunday vowed to open up China like ‘never before’.
According to state-run Xinhua news agency, the Chinese President told lawmakers that the country will continue to open up on all fronts and continue to liberalise and that there was no question of China closing its opened doors.
China has been trying several measures to keep the economy floating and struggling to keep the growth rate steady. It has moderated its economic growth forecast for 2017 to "around 6.5%" from the 6.7-7% it had targeted in 2016.
2017's target is below expectations and signals China is likely to embrace risk-control over short-term growth.
In 2016, however, it achieved a full-year growth of 6.7%. That figure was the weakest since the 1990s.
Xi Jinping’s remarks - made during a panel discussion with lawmakers from Shanghai at the annual session of the National People's Congress (NPC) - assume significance as China has been loosening its grip on foreign capital inflows and reducing restrictive measures and opening more sectors.
On Sunday, Premier Li Keqiang delivering a government work report detailed "unprecedented" opening-up measures to the outside world under its flagship 'Made in China' initiative. "Foreign firms will be treated the same as domestic firms when it comes to licences applications, standard setting, government procurement and will enjoy same preferential policies under Made in China 2025 initiative," Li said.
Foreign firms will be able to get listed on China's stock markets and issue bonds. They will be allowed to participate in national science and technology projects, he said. Significant improvements will be made in the environment for foreign investment. Service industries, manufacturing and mining will be more open to foreign investment, he added.
Local governments in China can, within the scope of the powers granted them by law, adopt preferential policies to attract foreign investment. With the renewed focus for FDI, China is expected to aggressively vie with India for investments abroad. Its forex reserves - the world's largest - dipped below $ 3 trillion, sparking concerns among the Chinese policymakers.
In the past few years, India has become a major destination for FDI under the 'Make In India' programme. According to a Financial Times report, "In 2015, India was for the first time the leading country (USD 63 billion) in the world for FDI, overtaking the US (which had $59.6 billion of greenfield FDI) and China ($56.6 billion)."
(With PTI inputs)