A Chinese expert in commerce is suggesting that a shorter "negative list" is not necessarily better for China's free trade zones.
Gu Xueming, head of the Chinese Academy of International Trade and Economic Cooperation, made the comment after China's State Council released a foreign investment negative list for its four pilot free trade zones.
"Firstly, you can't say which one is better: a positive list or a negative list. A country will only choose a suitable approach for managing investment according to its level of development, management capacity and legal environment. Secondly, you may ask, would it be better if the negative list was shorter? The answer is no. Every country should identify areas off-limits to foreign investment on the basis of its level of development and system."
China's new negative list precludes foreign investment in projects in 49 industries such as aviation manufacturing and nuclear power.
Meanwhile, China eased or removed restrictions on foreign investment in 18 sectors in the country's four pilot free trade zones.
The new list reduces the number of special administrative regulations on foreign investment to 122 from the previous 190.
The "negative list" approach is a major international practice to manage foreign investment.
The government identifies sectors where the entry of foreign investors is prohibited or restricted, while giving all market entities equal access to areas off the list.
