China's newly released action plan to stabilize foreign investment in 2025 addresses key concerns of foreign businesses by streamlining mergers and acquisitions rules, and introducing practical measures to foster stronger foreign business growth in the Chinese market, according to experts.
The action plan was approved at a State Council executive meeting presided over by Chinese Premier Li Qiang on Monday.
The meeting emphasized the important role foreign enterprises play in job creation, export stabilization and industrial upgrading, and urged more practical and effective measures to stabilize existing foreign investment and expand new investment.
Experts said that the action plan comes at a critical moment, as the global economy is grappling with rising isolationism and protectionism.
The plan effectively addresses key concerns of foreign businesses, offering clear and specific solutions for issues such as equity investment and cross-border mergers and acquisitions, while underscoring China's firm commitment to further opening up at a higher level.
"The action plan is both practical and systemic, calling for more effective measures to stabilize existing foreign investment and expand new inflows. Its implementation will play an important role in stabilizing foreign investment, boosting investor confidence in China, and contributing to the country's high-quality development," said Zhao Fujun, director of the Comprehensive Research Office at the Development Research Center of the State Council. According to experts, China's foreign direct investment (FDI) has long been predominantly focused on greenfield projects, leaving mergers and acquisitions relatively underutilized. In contrast, mergers and acquisitions are a major driver of foreign capital in key global investment destinations.
"The new action plan proposes optimizing the rules and procedures for foreign mergers and acquisitions, which will help promote foreign investment in China through such deals. It also facilitates adjustments to China's approach to utilizing foreign investment. The plan is expected to attract more foreign enterprises to deepen their presence in the Chinese market through mergers and acquisitions and engage in higher-level international cooperation with Chinese firms," said Zhang Wei, vice president of the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce.
The plan also emphasizes equal treatment of domestic and foreign enterprises in government procurement, while broadening financing channels for foreign companies, and strengthening intellectual property protections.
"The action plan introduces several practical measures aimed at creating a more internationalized and level playing field. By improving services for foreign businesses, facilitating the movement of foreign enterprise personnel, and ensuring more equitable treatment, the plan seeks to support the better development of foreign businesses in China, thus enabling them to share in the dividends of China's growth," Zhang added.
China's new action plan address key concerns to boost foreign investment: experts
