China sets timetable for nationwide "negative list" approach

BEIJING: Aiming to rejuvenate its economy, China will pilot a "negative list" approach, which identifies sectors and businesses that are off-limits or restricted for foreign investment, in some regions for two years starting from December this year.

The aim is to explore a system that could be replicated nationwide for application in 2018 as part of efforts to streamline government administration and give more freedom to the market, according to a published official guideline.

The "negative list" approach is a common practice adopted in many countries to manage foreign investment.

It will start in some regions from December 1, 2015 to December 31, 2017, authorities said.

China first piloted the rules in the Shanghai Free Trade Zone in 2013. Chinese economy registered 6.9 per cent for the first time after 2009 from 7 per cent in the Q2 as the slowdown continued in the world second largest economy.

By extending the approach to cover domestic businesses, China looks to unleash more vitality in the private industry as the economy slows, state-run Xinhua news agency reported.

Wang Yukai, professor with the Chinese Academy of Governance, said the move will help reduce the threshold for investment and business start-ups to bring out the potential of various market entities.

Data today showed China's economy expanded 6.9 per cent in the third quarter, the first time the quarterly growth rate has dropped under 7 per cent since the second quarter of 2009.