In 2014, facing gradually intensified international investment environment and great difficulties and challenges from economic downturn, China maintained a stable step in attracting foreign investment and saw further improvement in using foreign investment.

The overall scale of utilized foreign investment was maintained stable, with further improvement in using foreign investment. First, there was an increase of foreign investment. In 2014, foreign investment in actual use reached USD 119.56 billion, up 1.7% year-on-year; a total of 23,778 foreign-invested enterprises were established, up 4.4% year-on-year, ending the tendency for a drop that had continued for two consecutive years since 2012. Second, investment of major countries/regions in China kept stable. In 2014, the top 10 countries/regions (including Hong Kong, Singapore, Taiwan, Japan, ROK, USA, Germany, UK, France and the Netherlands) made a total of investment of USD 112.59 billion in China, accounting for 94.2% of national total foreign investment in actual use, up 2.7% year-on-year. The investment of ROK and UK in China had a fast increase, respectively reaching USD 3.97 billion and USD 1.35 billion, up 29.8% and 28% year-on-year. Third, the industrial structure has been further optimized and the competitiveness of the service industry for attracting foreign investment has been enhanced. In 2014, the service industry saw the establishment of 15,800 foreign-invested businesses, up 14.8% year-on-year, accounting for 66.3% of national total. Foreign investment in actual use of the service industry reached USD 66.23 billion, up 7.8% year-on-year, accounting 55.4% of national total. Fourth, foreign investment in actual use in the central part of China saw a fast increase, reaching USD 10.86 billion, up 7.5% year-on-year.

Reform of foreign investment management system has been promoted step by step. Great efforts have been made to basically realize the liberalization of trade in services concerning Hong Kong and Macao in Guangdong. Except for reserved restrictive measures under agreements, for service suppliers from Hong Kong and Macao to make investment in Guangdong, the examination and approval procedures for contracts and regulations for business establishment and modification have been changed to procedures for record management. The transformation from paid-in registered capital system to subscribed capital contribution system has been put into substantial practice, with the release of the Notification on Improving Review and Management Procedures Concerning Foreign Investment. The examination and approval procedures for identification of encouraged foreign investment projects have been cancelled. The record procedures for foreign businesses to invest in macro-control and real estate industries have been simplified. Cooperation with the State Commission Office of Public Sectors Reform has been launched to standardize and optimize the pilot projects for examination and approval for foreign investment projects to shorten the examination and approval duration and simplify application procedures and documents. In this way, the efficiency of examination and approval has been obviously improved. In addition, pilot project for refoval for foreign investment projects to shorten the examinatiorm of foreign investment management system has been launched in the pilot zone of Shanghai Free Trade Zone. Guidance has been provided for the pilot zone to improve record of foreign investment projects and enhance in-process and follow-up supervision.

Opening-up has been accelerated. Opening-up in various fields has been expanded. The major tasks fulfilled in 2014 include: cooperating with the National Development and Reform Commission to amend the Catalogue of Industries for Guiding Foreign Investment to further loosen the restrictions on proportion of shares of foreign investment and greatly reduce restrictive items and improve transparency; cooperating with related departments to make researches in fields of medical services, elderly care, e-business, education, business and logistics, and to issue relevant documents for expanding opening-up; promoting the opening-up of service industry under the CEPA framework to basically realize the liberalization of trade in services concerning Hong Kong and Macao in Guangdong; providing guidance for Shanghai Free Trade Zone to further shorten the Negative List for foreign investment in the pilot zone, and reducing the number of items under the Special Administrative Measures for Access of Foreign Investment 2013 from 190 to 139 (2014 version).

Source: www.mofcom.gov.cn, January 22, 2015