Invest in China / the Economy Opening Economy
Invest in China / the Economy
Opening-up is the Hallmark of Contemporary China
Chinese President Xi Jinping has repeatedly stressed that China will not shut its door of opening-up; it will embrace the world with more open arms.
Chinese President Xi Jinping gave a keynote speech, entitled Let the Breeze of Openness Bring Warmth to the World, at the Opening Ceremony of the Fourth China International Import Expo, highlighting that "as for China, we will not change our resolve to open wider at a high standard; we will not change our determination to share development opportunities with the rest of the world; and we will not change our commitment to an economic globalization that is more open, inclusive, balanced and beneficial for all."
At the 2022 World Economic Forum virtual session, President Xi Jinping stressed that "China will stay committed to reform and opening-up. For China, reform and opening-up is always a work in process. Whatever change in the international landscape, China will always hold high the banner of reform and opening-up. We will build a unified, open, competitive and orderly market system, where all businesses enjoy equal status before the law and have equal opportunities in the marketplace. All types of capital are welcome to operate in China in compliance with laws and regulations, and play a positive role for the development of the country. China will continue to expand high-standard opening-up, steadily advance institutional opening-up that covers rules, management and standards, deliver national treatment for foreign businesses, and promote high-quality Belt and Road cooperation."
At the Boao Forum for Asia Annual Conference 2022, President Xi Jinping pointed out that no matter how the world will change, China's faith in and its commitment to reform and opening-up will not waver. China will expand high-standard opening-up, fully implement the negative list for foreign investment, expand the encouraged catalogue for FDI, improve services for investment promotion, and add more cities to the comprehensive pilot program for services sector opening.
China will take solid steps to develop its PFTZs and the Hainan Free Trade Port, align with high-standard international economic and trade rules, and move ahead with institutional opening-up. China will implement the Regional Comprehensive Economic Partnership (RCEP) in full, seek the conclusion of high-standard FTAs with more countries and regions, and actively work for joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Digital Economy Partnership Agreement (DEPA). China will press ahead with high-quality Belt and Road cooperation to make it high-standard, sustainable and people-centered. China will unswervingly follow the path of peaceful development, and always be a builder of world peace, a contributor to global development, and a defender of the international order.
China has grown into the world's second-largest consumer market, the largest trader in goods, the second-largest trader in services, the holder of the largest foreign exchange reserves, and the second-largest economy in the use of foreign capital. Continuously strengthening its status as an economic and trade powerhouse, China has become the backbone and leader of economic globalization.
The total value of imports and exports of goods in 2021 reached RMB39,100.9 billion, up by 21.4% over the previous year, ranking first in global trade in goods for five consecutive years. In breakdown, the value of goods exported was RMB21,734.8 billion, up by 21.2%; the value of goods imported was RMB17,366.1 billion, up by 21.5%. The export of high-tech and high valued-added products grew rapidly, as mechanical and electrical products increased by 20.4%, and new energy vehicles rose three times. China exported supplies for COVID-19 prevention and control in an orderly manner. With over two billion doses, China became the country that offered the most vaccines to the rest of the world.
In 2021, China's total trade in services reached RMB5, 298.3 billion, up by 16.1% over that of the previous year, ranking second in the world for eight consecutive years. Specifically, the export value reached RMB2, 543.5 billion, increasing by 31.4% and import value recorded RMB2, 754.8 billion, growing by 4.8%.
In 2021, the paid-in foreign direct investment surged 21.2% to USD180.96 billion; 48,000 foreign-invested enterprises were established in China, rising by 23.5%. Both the scale and quality of foreign investment inflow were improved.
Investment in high-tech industries increased by 22.1%, with the share in the total growing to 28.8%. The foreign investment utilized by 21 PFTZs reached USD32.29 billion, accounting for 18.6% of the total foreign investment. By the end of 2021, more than 1.088 million foreign-invested enterprises had been set up in China, with an accumulated foreign investment exceeding USD2.6 trillion.
Taking up about 2% of the total number of enterprises in China, foreign-invested enterprises contributed about 2/5 of China's imports and exports, 1/6 of tax revenue, 1/5 of industrial added value and about 1/10 of urban employment.
In 2021, China's outbound direct investment (ODI) amounted to RMB936.69 billion, a year-on-year growth of 2.2%. First, the investment in countries along the Belt and Road saw fast growth. Non-financial direct investment into countries along the Belt and Road was USD20.3 billion, up 14.1% year on year. Second, the number of large foreign contracted projects grew. There were 560 newly-signed foreign contracted projects with a value of more than USD100 million, 46 more from the previous year, mainly in the infrastructure sector, such as transportation. Third, remarkable results were achieved in building overseas economic and trade cooperation zones. By the end of 2021, the overseas economic and trade cooperation zones included in the statistics of the Ministry of Commerce (MOFCOM) could be found in 46 countries. The investment totaled USD50.7 billion, contributing a combined USD6.6 billion in taxes and fees to host countries and creating 392,000 local jobs.
According to the World Investment Report 2022 by the United Nations Conference on Trade and Development (UNCTAD), FDI growth in China picked up pace in 2021, growing by 21% to USD180.96 billion. It made China the second largest host economy of FDI inflows in the world.
Contribution to the World Economy
Since its accession to the World Trade Organization (WTO) two decades ago, China has contributed an average of nearly 30% to global growth annually. China contributed about one quarter of global growth in 2021. Investing in China will enable investors to grow with the country's economy.
According to the 2021 Statistical Communiqué of the People's Republic of China on National Economic and Social Development, the profits made by industrial enterprises above the designated size funded by foreign investors or investors from Hong Kong, Macao and Taiwan were RMB2,284.6 billion, up by 21.1% over the previous year.
The China's Balance of Payments Report 2021 released by the State Administration of Foreign Exchange (SAFE) shows that the net increase in all kinds of investment in China was USD661.6 billion in 2021, of which FDI (net increase in liabilities) reached USD334 billion, up 32%, a record high. All these proved that China's economic growth has maintained a global leading edge, and its attractiveness to foreign investment has increased.