Nation eases path for multinationals
Overseas companies welcome new investment policies
For multinational corporations grappling with the coronavirus pandemic, China emerged as a silver lining to their balance sheets last year.
The nation has launched favorable policies to stabilize and attract foreign investment, and this was underlined on Friday when Premier Li Keqiang announced a series of opening-up measures in his Government Work Report. Li delivered the report to the fourth session of the 13th National People's Congress, the country's top legislative body.
According to business executives, foreign companies will benefit from China's latest plans to shape its role as a global growth engine in a test of locally adapted innovation and a venue for generating best business practices.
These plans include further cutting the negative list for foreign investment, opening the services sector in a well-regulated way, formulating a negative list for cross-border trade in services and advancing the Hainan Free Trade Port.
One of the companies to benefit is the German chemicals giant Covestro, which produces a variety of polyurethane and polycarbonate-based raw materials used in industries from automobiles to electronics.
China contributed to more than 20 percent of Covestro's annual sales last year, regaining its position as the company's largest single market after being overtaken by the United States a year earlier.
Holly Lei, president of Covestro China, said: "The country was the 'backbone' for our performance last year. In the company's eyes, China was definitely the first to enjoy growth and lead the global recovery."
She attributed these achievements to the effective pandemic control measures implemented by the Chinese government, which led to a swift rebound in manufacturing and broader economic activities.
"We, as a foreign enterprise, welcome such policies highly and have benefited a lot," Lei said.
The string of opening-up measures is good news for foreign companies operating in China.
Premier Li said the country would promote steady growth of imports and exports this year, increase credit support to small and medium-sized foreign trade companies, and encourage the development of new forms of trade, including cross-border e-commerce.
Executives said such efforts would create a high-quality business environment and promote economic globalization.
French cosmetics giant L'Oreal, whose China headquarters is located in Shanghai, cited a number of initiatives launched by the local government that helped advance the company's development in the country and achieve 27 percent year-on-year growth last year.
Fabrice Megarbane, president of L'Oreal North Asia Zone and CEO of L'Oreal China, said, for example, that Shanghai's Pudong New Area launched a pilot policy for imports of non-special-use cosmetics.
"L'Oreal acquired the first pilot enterprise user account and product registration certificate, reducing approval time from three months to five working days," he said.
Megarbane added that with the policy accelerating sales operations and new product launches, L'Oreal is now introducing more than one new product in China every day on average.
Cytiva, formerly known as GE Healthcare Life Sciences, also stands to enjoy streamlined government services to help this newly-established spinoff better navigate its way in China.
Yu Lihua, Cytiva's general manager in China, said she originally expected a complicated process to register as a stand-alone company, involving the completion of commercial operating, licensing and tax registration procedures.
"However, we are extremely impressed by the transparency and efficiency of the administration of Lingang Special Area of China (Shanghai) Pilot Free Trade Zone. The local government officials truly position themselves as the enablers of companies," Yu said.
In just 24 hours, Cytiva completed procedures to apply for a business license for continuous operation. Local authorities also organized one-on-one follow-up roundtable sessions for policy consultations.
China's Foreign Investment Law has helped foreign-funded enterprises buck the downward trend to attract foreign capital during challenging times.
Zang Tiewei, a spokesman for the Legislative Affairs Commission of the National People's Congress Standing Committee, said that since the law took effect on Jan 1 last year, foreign investment to China had risen by 4.5 percent year-on-year in dollar terms, reaching a record high.
The nation had become the largest recipient of foreign capital worldwide, and 51,000 new foreign-funded companies were established in China last year, Zang said.