Foreign investment flowing into China has become an important
component of the economy since the country joined the World Trade
Organization three years ago.
"FDI has been integrating with Chinese employment, consumption
and the service sector since China entered the WTO in 2001," stated
Jin Bosheng, a researcher with the China Academy of International
Trade and Economic Cooperation.
Zheng Weidong, of the Chamber of Commerce for Import and Export
of Machinery and Electronic Products (CCCME), noted that ordinary
citizens are building increasingly close and extensive ties with
foreign-funded companies.
According to the Ministry of Commerce (MOC), there are 250
million urban employees in China, 25 million of whom work for
foreign-funded companies. The jobs of 80 million Chinese are
directly related to foreign trade.
Meanwhile, the growing number of foreign-funded factories has
substantially improved China's manufacturing ability.
"China has bought more high-end machinery and electronic
products from abroad, most of them are technology-intensive,
especially in the automobile and home appliance sectors," Zheng
said.
In the first 10 months this year, Chinese imports of color
television sets decreased 40 percent by volume. The value of the
sets, however, increased 73 percent. Zheng states that this is
because China is now purchasing better-quality TVs.
CCCME reports that import volumes of digital video cameras,
digital cameras and DVD players leapt 450 percent, 50 percent and
113 percent, respectively, in the first 10 months this year. Import
values of the same products increased 155 percent, 100 percent and
30 percent.
As the Chinese market opens wider, people will enjoy a variety
of improved and more convenient services.
Since December 11, foreign companies have been permitted to
conduct retail and distribution business without limitations on
location. Multinational retailers such as Wal-Mart and Carrefour
have embarked on ambitious expansion programs, while many foreign
companies stepped up market surveys in 2004, on commodities ranging
from soap to high-end mobile phones.
Restrictions in the insurance, securities, banking and finance,
tourism, transportation and storage sectors are being phased out as
well.
China has also opened its telecommunication sector to some
extent. Foreign investors have been granted permission set up joint
ventures and provide services in Shanghai, Guangzhou and Beijing
since December 11, with a maximum shareholding of 30 percent.
Another 14 cities, including Shenzhen and Hangzhou, will open to
foreign investment in telecommunications next year.
In the banking sector, the Hong Kong and Shanghai Banking
Corporation Limited (HSBC) and the Beijing branch of the Standard
Chartered Bank were approved to conduct RMB business in Beijing
earlier this month, the first two foreign banks to gain such
permission. Foreign banks will be allowed to provide comprehensive
banking services in China by 2006.
Also in accordance with China's WTO commitments, foreign
investors will be allowed to set up express and road freight
businesses in 2005 and railway and logistics enterprises will be
able to establish wholly owned companies in 2006.
(Xinhua News Agency December 29, 2004)