China strives to attract foreign investment amid geopolitical tensions

BEIJING — China is trying yet again to boost foreign investment, amid geopolitical tensions and businesses’ calls for more concrete actions.

On Feb. 19, authorities published a “2025 action plan for stabilizing foreign investment” to make it easier for foreign capital to invest in domestic telecommunication and biotechnology industries, according to a CNBC translation of the Chinese.

The document called for clearer standards in government procurement — a major issue for foreign businesses in China — and for the development of a plan to gradually allow foreign investment in the education and culture sectors.

“We are looking forward to see this implemented in a manner that delivers tangible benefits for our members,” Jens Eskelund, president of the European Union Chamber of Commerce in China, said in a statement Thursday.

The chamber pointed out that China has already mentioned plans to open up telecommunications, health care, education and culture to foreign investment. Greater clarity on public procurement requirements is a “notable positive,” the chamber said, noting that “if fully implemented,” it could benefit foreign companies that have invested heavily to localize their production in China.

China’s latest action plan was released around the same time the Commerce Ministry disclosed that foreign direct investment in January fell by 13.4% to 97.59 billion yuan ($13.46 billion). That was after FDI plunged by 27.1% in 2024 and dropped by 8% in 2023, after at least eight straight years of annual growth, according to official data available through Wind Information.

All regions should “ensure that all the measures are implemented in 2025, and effectively boost foreign investment confidence,” the plan said. The Ministry of Commerce and National Development and Reform Commission — the economic planning agency — jointly released the action plan through the government’s executive body, the State Council.

Officials from the Commerce Ministry emphasized in a press conference Thursday that the action plan would be implemented by the end of 2025, and that details on subsequent supportive measures would come soon.

“We appreciate the Chinese government’s recognition of the vital role foreign companies play in the economy,” Michael Hart, president of the American Chamber of Commerce in China, said in a statement. “We look forward to further discussions on the key challenges our members face and the steps needed to ensure a more level playing field for market access.”

AmCham China’s latest survey of members, released last month, found that a record share are considering or have started diversifying manufacturing or sourcing away from China. The prior year’s survey had found members were finding it harder to make money in China than before the Covid-19 pandemic.

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