From China Rising:
One of China’s leading economists, Professor Lin Yifu , recently said of China’s position in the world: 4th in GDP, 3rd in Trade, 2nd in Foreign Direct Investment and 1st in Foreign Exchange Holdings . Perhaps the fact that China is second and first in areas that has the word “foreign” in its title led many in China’s business arenas to reconsider their protectionist positions.
Now the party state has heard the call, and it appears the ongoing debate on the future of foreign direct investment (FDI) is coming to a temporary close. Back in March, China already “equalized corporate tax rates paid by local and overseas enterprises.” That’s 30 years of favorable treatment to foreign firms out the window. But to further the process, Beijing issued rules to “prohibit or limit foreign investment in key industries as it seeks to cool its overheated economy and clean up its damaged environment.” Now that’s a huge step. [Full Text]
See also: Chinese Experts Warn Cash Surpluses Risk Overheating Economy from Voa News.