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Economic Watch: China's Further Opening up Delivers Greater Business Opportunities

2018-10-12 11:18:05.0

Opening up, a commitment China has and will continue to follow, will generate new opportunities for the common prosperity of the country and the world.

In the latest pledge for further opening up, Premier Li Keqiang said Wednesday that China will promote a higher level of opening up and will continue to be an ideal place for foreign investment.

Li made the remarks while meeting with Harald Kruger, chairman of the BMW Group, as the German carmaker celebrates the 15th anniversary of its Chinese joint venture (JV) BBA with a long-term contract extension and extensive investments to lift capacity to tap into China's fast-growing market.

SHARED OPPORTUNITIES

"With continuous investment, as well as the development and production of electric vehicles, we underline China's importance as a dynamic growth market for us," Kruger said.

The company also intends to take majority control of the JV, increasing its stake in BBA from 50 percent to 75 percent, the first such move by a global carmaker after China announced plans to ease ownership rules for auto JVs in the world's largest car market.

BMW is not alone in its expansion into the massive and ever-growing Chinese market. As the country further opens up its financial market and eases foreign ownership caps, international financial giants such as J.P. Morgan Chase & Co. and UBS all announced plans to expand their footprints in the country.

"We welcome enterprises from different countries, including German enterprises, to seize the opportunity and expand investment in China and better achieve common development and win-win results," Li Keqiang said.

By further lowering import tariffs and hosting the China International Import Expo, China aims to buy more products from its trade partners, which are expected to top 8 trillion U.S. dollars over the next five years.

Apart from liberalizing the market and increasing the international presence in China, the country further opens up by encouraging its firms to go global, which creates local jobs and boosts local economies.

According to an estimation of the U.S.-China Business Council, the U.S.-China trade relationship supports roughly 2.6 million jobs in the United States, including jobs that Chinese companies have created in America.

In countries along the Belt and Road, China has set up 82 overseas economic and trade cooperation zones over the past five years, investing 28.9 billion dollars and creating about 244,000 local jobs.

"As a responsible major country, China is willing to open its market and share opportunities with others," said Li Yong from China Association of International Trade.

STRATEGIC CHOICE

Opening up was key to China's economic growth over the past 40 years, and economists said the high-quality development of the economy in the future can only be achieved with greater opening up.

The country's economy has grown 33.5 times in the past 40 years of reform and opening up, with an average annual growth of 9.5 percent, much higher than the world average of about 2.9 percent during the same period.

"Opening up is the path China must take to achieve prosperity and development," Minister of Commerce Zhong Shan said in a signed article on the People's Daily in July.

Analysts viewed greater opening up as a strategic choice China has made as it seeks high-quality development.

Wang Xiaosong, a scholar at Renmin University of China, said wider opening up is a step China has taken after assessing the achievements it has made and challenges it faces. "It's a self-initiated move that serves both China's own interests and demand for future development."

The country has unveiled a host of measures this year, including expanding market access for foreign investors, lowering enterprises' operation costs and shortening a negative list that specifies off-limits or restricted sectors to foreign investors.

"China is putting in place a slew of opening up measures announced earlier this year and there are more such measures to come with greater intensity and at a higher level," Zhong Shan told the heads of six multinational companies in China at a symposium held last month.

To open up on a higher level, Cui Fan, a trade expert at the University of International Business and Economics, said while opening the door wider, efforts should be taken to improve rules and mechanisms.

The country will provide stronger protection of intellectual property rights and a better business environment for enterprises, Zhong said. (Source: Xinhua)