At the heart of China's success: Reform and opening-up
Don't follow a trend, follow your heart.
Hello and welcome to another edition of “CGTN Observes.” I'm Tian Wei.
Many of us have heard advice like this or something similar, as we are looking to turn the page in life and work. I wonder whether it is also true as a country is searching for its own new momentum.
China just celebrated 40 years of reform and opening-up. At the heart of China's success, many say, are the policies on reform and opening-up.
Here's an example. Over the past four decades, foreign investment has become a significant driving force in the rapidly growing Chinese economy. Until October 2018, almost 950,000 foreign companies, which have invested more than 2.1 trillion yuan in foreign capital, were registered in China. As the second largest economy in the world, China received record high direct investments in 2017, ranked just behind the U.S. Even at the height of the trade dispute between China and the U.S., many foreign investors not only stayed in China but were even more committed to the business and market here.
That is what opening-up has done to China. That is also what the Chinese Premier made clear in the Government Work Report this year:
"We will promote all round opening up and foster new strengths in international economic cooperation and competition.”
While, in contrast, some other economies over the past few years have turned inward, becoming ever more self-centered, and have allowed protectionism and unilateralism to hijack the development agenda.
At a critical juncture, the choices China have to make, will not only decide the near-term economic prospect of this country, but also inevitably affect, as the second biggest economy and largest developing economy, the direction of how businesses are done all over the world.
With this in mind, people are taking a closer look at the current debate on the Foreign Investment Law, during the National People's Congress meeting.
The draft streamlines the current foreign investment law by replacing the three existing ones for Chinese-foreign joint ventures and wholly foreign-owned campaigns with a five-year transition period. One of the changes the draft presents, compared to earlier legislation, is the equal treatment for domestic and foreign businesses, and prohibits forced technology transfer to protect foreign intellectual property. It also seeks to expand market access for foreign investors, and it aims at raising the predictability and transparency of the foreign investment administration.
The word from the ongoing NPC meeting is that it is aimed at improving the openness, transparency and predictability of the investment environment, and providing more effective legal protection for the formation of a new and more open system.
Well, I am not a legal scholar at all and in no authority to give a legal analysis of the draft law for now. However, a knee-jerk dismissal of the significance of such legislation, is far from responsible, particularly at a time when China and the U.S. are still both trying to work out their future to co-exist peacefully, beginning with trade.
When you see some countries, despite protectionist measures in the name of cutting trade deficit, end up with larger deficit numbers, it might be a big hint about the best way to do things.
Don't follow a trend, particularly when common sense tells you it's wrong. Follow your heart and your own path, particularly when it proves once and again, it has made you into who you are. For China, it can be simply summed up in three words: reform and opening-up.
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