According To An Official, China’s New Growth Goals Require A Change In Order To Attract International Investors

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Last Updated on October 17, 2022 by Bitfinsider

On Monday, a Chinese official confirmed that the country’s growth goals have been adjusted, and they indicated that things will change for foreign investment.

In a speech that he gave on Sunday, Chinese President Xi Jinping set the tone for the next five years by emphasizing “higher-quality” growth and the need for national self-sufficiency. This speech will set the tone for the next five years. In comparison to previous years, he did not emphasize the speedy expansion of the economy as much.

After President Xi’s speech, the National Development and Reform Commission (NDRC), which is in charge of economic planning, held the first press conference with representatives in charge of ensuring food and energy security.

According to Zhao Chenxin, a member of the commission’s Chinese Communist Party leadership group and vice chairman, “China’s economy has shifted from a period of high-speed growth to one of high quality.” This statement was made by the commission.

According to what he said, “We also face a new situation in terms of attracting foreign investment.” This is according to a translation of the Mandarin remarks that was provided by CNBC.

During the 1990s and early 2000s, when new government policies permitted greater foreign access to the market after decades of closure, China’s initial surge of economic growth was largely due to the country’s heavy reliance on investment from overseas.

For instance, according to a report published by the Hinrich Foundation in 2013, foreign businesses in China were responsible for approximately 27% of total employment and accounted for approximately 33% of China’s GDP.

According to the report, a significant portion of that revenue came from sales of automobiles, leather goods, and products related to computers and electronic goods.

However, in recent years, foreign businesses have been vocal about their dissatisfaction with China’s unequal access to the Chinese market in comparison to that of their peers, the lack of protection for intellectual property, and the forced transfer of technology. The administration of President Trump in the United States made efforts to address those issues by imposing tariffs and sanctions.

Looking ahead to the future, Zhao said on Monday that China would encourage foreign investment in advanced manufacturing, higher-quality services, high technology, energy conservation, and environmental protection.

In addition to this, he mentioned that there is particular support for such investments in the central, western, and northeastern regions of China. Those areas of the country have not seen as much economic growth as the southeast and the east coast have.

In a report published in September about European investment in China, analysts from Rhodium Group said that “one would have expected the country to attract a much broader range of foreign firms given the size and growth of the Chinese economy in recent decades.” However, three distinct categories of investors are noticeably absent from our analysis of recent developments.

The analysts pointed to a lack of investors in the services sector, a reduction in the number of European companies interested in acquiring Chinese businesses, and a lack of new entrants to the market as the primary reasons for this.

According to the Ministry of Commerce of China, foreign direct investment from Germany increased by approximately 30.0% in the first eight months of the year compared to the same period a year earlier. This growth rate is faster than the 23.5% pace recorded for the first seven months.

The ministry, however, did not release any updated figures for the amount of investment coming from the United States, despite the fact that official data showed that it had increased by approximately 36% in the first seven months of the year.

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