China Urges Foreign Businesses to Share Concerns Amid Investment Decline

01 Mar, 2024

China Urges Foreign Businesses to Share Concerns Amid Investment Decline

China’s Ministry of Commerce convened with foreign businesses this week in Beijing to tackle operational hurdles, yet yielded little advancement on significant fronts. Jens Eskelund, president of the EU Chamber of Commerce in China, highlighted concerns regarding alterations in national security regulations affecting due diligence practices within China. The gathering coincided with a resurgence in U.S.-China engagements as both nations endeavor to stabilize their intricate economic ties.

While the meeting failed to unveil substantial progress on the 24 initiatives announced last summer to bolster foreign business, participants found an avenue to articulate specific challenges encountered in China. Eskelund noted a genuine eagerness from the Ministry to act on these initiatives, soliciting concrete examples from attendees.

Nevertheless, the session failed to clarify the timeline for proposed revisions to data export regulations, nor did it broach topics such as forced technology transfers or the new state secrets law. In a parallel development, China disclosed updated regulations on state secrets set to be enforced from May 1, underscoring the nation's heightened focus on safeguarding national security.

Michael Hart, president of the American Chamber of Commerce in China, raised concerns about an excessive focus on attracting investments from new entities during the meeting. This drive, he pointed out, often originates from local officials keen on showcasing their prowess in attracting foreign direct investment (FDI).