Market access

China to reduce institutional transaction costs and expand market access

Butchers prepare meat for sale at a market in Chengdu, southwest China’s Sichuan Province, Sept. 2, 2022. Photo: Xinhua

China is working to reduce institutional transaction costs and expand market access for businesses, in an effort to further improve the business environment, support businesses and help stabilize macroeconomics, according to an official document made public on Thursday.

The document, issued by the General Office of the State Council, China’s cabinet, contained more than 20 measures, including the full implementation of the negative market access list and the start of the elimination of all visible and invisible barriers to market access before October.

Regarding the implementation of the negative list, the document called for detailed plans, including the launch of a negative list for domestic cross-border trade in services and the adoption of the negative list management mechanism for foreign investors.

In particular, the document, dated September 7, calls on departments and regions to eliminate visible and invisible obstacles to market access before the end of October, as well as establish a long-term mechanism to eliminate these obstacles. .

Bai Ming, deputy director of international market research at the Chinese Academy of International Trade and Economic Cooperation in Beijing, told the Global Times on Thursday that the measures will improve efficiency by further reducing administrative bureaucracy, and that a more unified negative list will be conducive to the development of the unified national market.

For China to push for the “dual circulation” development paradigm, in which domestic circulation will serve as the mainstay, a negative list for domestic and foreign enterprises is needed to let market factors flow undisturbed within of the domestic market, he said.

Xi Junyang, a professor at the Shanghai University of Finance and Economics, told the Global Times on Thursday that the so-called invisible barriers are discretionary restrictions that keep businesses out of certain sectors.

“It’s like a glass door. You don’t see the restrictions, but they’re actually blocking you,” Xi said, noting that measures to remove these barriers will help attract foreign businesses. “Policy makers take a long-term view,” he said.

Xi also predicted that China would continue to reduce the negative list, but probably not on a large scale, as the government has already shortened it several times.

Apart from the negative list, the measures also target unreasonable fees in order to ease the burden on market entities. For example, China will continue to clean up and adjust unreasonable fines and inappropriate fines.

Securities firms, funds and other institutions are also encouraged to further reduce service fees for their clients.

world times