China will vote on the draft foreign investment law on Friday. The draft law is part of the country's efforts to further open its economy. China has long been one of the most favorite destinations for foreign investors. But how did that happen? Michael Wang gives us a brief introduction on China's economic opening-up.

MICHAEL WANG China's markets are more open than you think: We often hear from foreign executives and lawmakers that China's markets are not open enough. Many are looking to this year's Two Sessions for further guidance on where China stands on its market opening process.

There is no purely open economy anywhere in the world. But policymakers in China have to be especially careful when it comes to the markets. One faulty move could be greatly magnified in a country with close to 1.4 billion people. Having said that, China's economy is more open than you think. Here's why. Number one: There are misconceptions about the mode of starting a business for foreign companies in China. For every single year that data is available, the number of wholly foreign owned enterprises (WFOEs) approved far outnumber that of joint ventures. WFOEs don't require a Chinese partner in business operations. In 2018, the number of wholly foreign owned enterprises approved was nearly five fold versus joint ventures. The highest on record.

Number two: China's policymakers have taken numerous steps to open up the economy in recent years. It may be lost in the details but the actions are there. For example, by early 2018, non-administrative license approvals have all been cancelled and investment projects, which require Beijing's verification have been slashed by 90-percent. The time it takes to start a business in China have been cut by at least one-third. These are just a few moves out of many.

Number three: At its current development stage, China's weighted tariff rates are lower compared to its neighbors Japan and South Korea when they were at a similar or higher development stage. The latest numbers from the World Bank show China's weighted tariff rate for all products standing at 3.83% in 2017. That corresponds with a Chinese per-capita GDP of around 8,800 U.S. dollars. When South Korea had a similar per-capita GDP, its weighted tariff rate was at least 3 percentage points higher. In the earliest year for when data is available – 1988, Japan's weighted tariff rate came in at over 4%, but that's when Japan already had a per-capita GDP of over 25,000 U.S. dollars. It's important to put China's current market opening in context and in perspective. If China's economy is truly difficult to access, sales of multinationals based in China wouldn't reach hundreds of billions of dollars annually and China wouldn't always rank number one or two in the world when it comes to attracting foreign direct investment.

From hosting the world's first expo dedicated to imports to building free trade zones, China will continue to open-up even as global growth moderates and economic uncertainties abound.

But give China time. Chinese policymakers take a long-term view on economic development. It does things in a gradual manner to ensure stable growth. Sometimes this can conflict with the quarterly or annual mindset of corporations. But, China will remain squarely on the path of opening-up.