Sat, Jun 30, 2018 - Page 10 News List

China opens economy as trade war looms

‘NEGATIVE LIST’:Beijing is removing curbs on gas station ownership, cereal trading and electricity infrastructure, while easing restrictions in the auto and aircraft industries

AFP, BEIJING

China has announced sectors of the economy where it will ease foreign investment rules, with leaders stepping up efforts to portray the nation as opening up as they prepare for a possible trade war with the US.

The new “negative list” outlines key reforms in the financial sector, while dropping restrictions in areas including the auto industry, agriculture, infrastructure and mining.

The list released on Thursday by the Chinese National Development and Reform Commission, which is to come into effect on July 28, reduces the number of fields with limits to 48 from 63 last year, but it also notes that some sensitive areas such as culture and national security would continue to be protected.

The announcement comes after the government unveiled changes earlier this year, which were seen as a nod to the US and other Western nations that have complained about lack of access to the world’s No. 2 economy for years.

Among them are the cancelation of foreign shareholding caps for banks and allowing 51 percent control in some other financial fields for three years, after which the restrictions are to be scrapped.

However, critics say the policy comes with other limits that make only the largest foreign banks eligible for entry.

The list also removes curbs on gas station ownership, cereal trading and electricity infrastructure, while also easing restrictions in the auto, aircraft and shipbuilding industries.

The announcement comes as the world’s two largest economies prepare next week to slap the first batch of new border taxes on tens of billions of US dollars of goods from both nations, fanning fears of a potentially damaging trade war.

Facing outside protectionism, China must “make greater efforts to promote openness, promote reform, promote development, promote innovation through openness and promote the further development of economic globalization,” the commission said in a statement. “Investment cooperation between China and other countries and regions will be deepen further, with more extensive exchanges of capital, technology, management and talents carried out.”

Beijing’s rhetoric is in sharp contrast to Washington, where officials have been considering ways to limit Chinese investment and even the flow of some Chinese nationals to US universities.

Beijing has been keen to portray itself as the wronged party, repeatedly saying it does not want a trade war, but that it would hit back with equal strength if forced into a corner.

Officials on Thursday also released a white paper mounting a full-throated defense of its pledged reforms and promises since joining the WTO in 2001.

“China has steadfastly carried out every promise made upon entering the World Trade Organization,” Chinese Vice Minister of Commerce Wang Shouwen (王受文) said when introducing the report, before challenging nations that do not agree to “sue us at the WTO.”

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