To end trade war, China to pass new foreign investment law to meet Trump's demands
Beijing: China is all set pass a new foreign investment law to provide a level playing field to global investors with legal safeguards on IPR and technology transfer, some of the main demands of US President Donald Trump to end the trade war between the world's two largest economies.
The US and China are locked in a trade war since Trump imposed heavy tariffs on imported steel and aluminium items from China in March last year, a move that sparked fears of a global trade war. In response, China imposed tit-for-tat tariffs on billions of dollars worth of American imports.
China is the world's second largest economy after the US.
The draft foreign investment law will be submitted to the top legislature, the National People's Congress (NPC), for review on March 8 and put for vote on March 15, Zhang Yesui, spokesman of the NPC said on Monday.
Asked why China is passing the new foreign investment law in a hurry, Zhang said that the interests of China and the United States are deeply interwoven and a confrontational China-US relationship does not benefit anyone.
China has a clear policy towards its relationship with the US, which is based on no-conflict and no-confrontation, mutual respect and win-win cooperation, he said.
The adoption of the foreign investment law is an innovation in the legal system on foreign investment and is to replace the existing three laws and serve as the basic law on foreign investment as China continues to open up in the new era, Zhang said.
The draft foreign investment law clearly stipulates that foreign investment in
China will be subject to pre-established national treatment plus a negative list
management system and the case-by-case approval management mode will be abolished, he said.
According to the draft law, industries where foreign
investment is prohibited or restricted are specified in the negative list. Industries that are not on the list will be fully open, with domestic and foreign firms enjoying the same treatment.
"This is a fundamental change in China's foreign investment management
system, and help create a more open, transparent and predictable environment for
investors and provide stronger legal guarantee on China's new opening-up," Zhang said.
The draft law also has clear positions on the protection of foreign investors' rights regarding issues such as IPR protection and technology transfer that are of common concern to foreign investors, he said.
"The new issues should not be dealt with cold war mentality against the background of globalisation," he said.
Differences in such areas as history, culture, political system and development
stages between the two countries are very normal, but the differences do not necessarily have to lead to confrontation and conflicts, Zhang said,
adding that cooperation is the best choice for China and
At the same time, China firmly safeguards its own territorial safety and interests for development, he said.