A larger number of foreign enterprises in China are resuming work and production thanks to the country’s continuous efforts to combat COVID-19.
A recent survey covering over 8,200 key foreign enterprises across China showed that 76.6 percent of them had recovered 70 percent of their capacity. The number stood at 81.2 percent for those in the manufacturing sector, and 66.8 percent for those in the service sector, according to the survey.
The Ministry of Commerce (MOFCOM) recently issued guidelines on improving services for foreign enterprises, as well as attracting investments, stabilizing foreign trade and foreign investment, and stimulating consumption. It also established a working mechanism with relevant departments and local governments to timely spot and address foreign enterprises’ difficulties in work resumption.
The ministry facilitated the work resumption of over 20 suppliers of key auto parts in central China’s Hubei province, which effectively tackled the problems encountered by the auto sector that has a long industrial chain.
Besides, it also joined hands with the Civil Aviation Administration of China to match foreign enterprises’ demand with airline companies, so as to relieve the pressure on electronic enterprises.
“The country has unveiled policies and measures to stabilize foreign investment and worked hard to facilitate and protect investment this year, which has continuously boosted the confidence of these enterprises,” said Gao Feng, spokesperson of the MOFCOM, adding that a series of key projects have been contracted, or are in implementation.
Many local governments and relevant departments in China have introduced fiscal, tax, financial, social security and employment policies, in a bid to help the enterprises hit hard by the sudden COVID-19 crisis, especially medium, small and micro businesses. These preferential policies also apply to foreign entities.
It is stipulated in the Foreign Investment Law that all national policies on supporting the development of enterprises shall equally apply to foreign-funded enterprises in accordance with the law.
Regulation for Implementing the Foreign Investment Law of the People’s Republic of China also makes clear that governments and their appropriate departments shall, in accordance with the law, equally treat foreign-funded enterprises and wholly Chinese-funded enterprises in such aspects as government funding arrangements, land supply, tax and fee reduction and exemption, qualification licensing, development of standards, project applications, and human resource policies.
Over 90 percent of the over 400,000 foreign enterprises in China are small and medium businesses, and most of them could benefit from these favorable policies.
China has a 500,000 foreign trade companies, and 84,000 of them are funded by foreign capital which account for 40 percent of the country’s total imports and exports. They are also the beneficiaries of the preferential policies.
Considering that some foreign enterprises may not fulfill their contracts or deliver the products on time due to the epidemic, the China Council for the Promotion of International Trade are providing them with force majeure certificates to shield them from legal damages arising from the novel coronavirus disease.
Such certificates were recently issued to a US company and a South Korean company. They were engaged in a 7-million-yuan and a 5-million yuan contract, respectively, offering strong support for them to continue their contracts and negotiate with their partners over the delayed delivery.
Experiences are gained by local Chinese governments in facilitating the work resumption of foreign enterprises according to their own conditions.
A working mechanism was established in east China’s Jiangsu province to coordinate efforts at provincial, municipal and county levels, which promoted the work resumption of enterprises on the supply chain of multinationals in the province, including Honeywell and LG Chem. A total of 118 foreign investment projects were signed during the pandemic response, whose total investments were expected to reach $14.36 billion.
Amid the ongoing efforts of preventing and controlling the COVID-19 disease, 118 foreign investment projects were signed, whose total investments were expected to reach $14.36 billion.
East China’s Shandong province facilitated work resumption of 32 major suppliers of South Korean automaker Hyundai. It also sought help from 21 provinces and municipalities to follow the restoration of production of 202 companies that work closely with 46 foreign enterprises in Shandong.
Guangdong province established a direct communication mechanism between its governor and multinational companies, and responded to the appeals of over 50 foreign enterprises in the province. The mechanism enabled the province to closely follow the key projects under construction or negotiation, which greatly advanced the process of these projects.
Visiting 720 regional headquarters of multinational companies and contacting nearly 70 percent of the foreign enterprises in the city, Shanghai effectively solved their problems in the supply of anti-epidemic materials, synergetic production resumption, logistics and financing.
East China’s Zhejiang province also gave full play to its advanced internet industry and held multiple online investment and trade fairs ensure connection with foreign companies and continuation of projects. It recently inked 74 foreign investment projects on online platforms totaling $6.21 billion.
Production is in full swing in Qingdao Pohang Stainless Steel Co., Ltd. in Xihai’an (West Coast) New Area, Qingdao, Shandong province on February 27.
