FTZ ‘negative list’ may be cut by 40 pct to boost more interest
Administrators said more detailed policies will be introduced in the China (Shanghai) Pilot Free Trade Zone this year in order to boost interest and push forward reforms.
Zhou Zhenghua, head of the Development Research Center of Shanghai Municipal People’s Government, said at a news conference in Shanghai on Sunday that the so-called “negative list” for the FTZ may be cut by 40 percent in 2014, meaning more sectors will be opened up to investors in the zone.
The Shanghai government published the list of areas that are off-limits or come with restrictions to investors in the FTZ last September. The list currently includes 190 special regulatory measures, covering a broad range of activities.
Zhou said 40 percent is a target the municipal government aspires to, although if or when it can be reached depends on decisions made by various departments within the central government. “But even if only 20 percent or 30 percent of the current version is cut, it will be a huge step forward,” he said.
Last November, the Shanghai municipal government said its negative list would be modified to further support trade and financial reforms.
The list is reviewed annually, according to Shanghai municipal government.
Yang Xiong, Shanghai’s mayor, said two concerns stood out. “One concern is the list is too long. Another is how to secure its transparency,” said Yang.
Zhou said the 2014 version of the negative list should clarify some of the restrictions to investors. Shanghai’s pilot free trade zone will liberalize more services as well as ease a threshold for foreign capital in emerging sectors this year as it continues with its economic upgrading, said Jian Danian, deputy director of the China (Shanghai) Pilot Free Trade Zone Administration.
“Further liberalization of service sectors, including senior care, architectural design, accounting and auditing, e-commerce and film production, is among the priorities for the pilot zone this year,” Jian said.
The administration also plans to lower the threshold for foreign investment in emerging industries such as marine engineering equipment, aerospace manufacturing and new energy, he said.
As many as 23 measures for reforming the FTZ’s service sector were introduced in 2013 and, so far, 22 have been implemented. The only one not introduced yet is the restricted license bank.
Zheng Yang, head of the Shanghai Financial Services Office, said that a new batch of details for FTZ financial reforms will be introduced soon, including some that are designed to facilitate convenient exchanges for investment and financing.
According to a note from Haitong Securities, enterprises and investors should have fresh confidence in the FTZ as policy relaxations in the zone accelerate and favorable conditions boost trade.