New industry list for investors
Source: Agencies |
April 26, 2011, Tuesday
|
Print Edition
Print Edition
CHINA'S economic planning agency yesterday published a new list of industries that it would encourage, restrict or ban, a blueprint that could have a far-reaching impact on investment activity in the country over the coming years.
The list will serve as a guideline for Chinese regulators in making policies on tax, bank credit, land and trade, and will also be a reference for the country to decide which foreign investors are welcomed.
In a statement summarizing the new guidelines, the National Development and Reform Commission said the list makes changes to the previous version, published in December 2005, to reflect technological change and industrial development.
"Some steel, nonferrous and construction material products have seen serious overcapacity, for which we will no longer encourage ordinary capacity in these areas," the NDRC said.
For projects in sectors listed as "to be encouraged," investors often find it easy to obtain approval from the government, in addition to cheap bank loans and land as well as preferential tax treatment.
But for industries labeled as "restricted" or "to-be-eliminated," investors will find it difficult to obtain governmental approval for new projects and to maintain operations. For example, such projects would be the first to be cut off at times when electricity is restricted because of power shortages.
The updated list has included new energy, inner-city railway transport equipment and public security devices into the "encouraged" category.
Automatic control systems for vehicles, high-speed precision bearings as well as key parts for new-energy vehicles will also be encouraged.
No other detail were available.
The list will serve as a guideline for Chinese regulators in making policies on tax, bank credit, land and trade, and will also be a reference for the country to decide which foreign investors are welcomed.
In a statement summarizing the new guidelines, the National Development and Reform Commission said the list makes changes to the previous version, published in December 2005, to reflect technological change and industrial development.
"Some steel, nonferrous and construction material products have seen serious overcapacity, for which we will no longer encourage ordinary capacity in these areas," the NDRC said.
For projects in sectors listed as "to be encouraged," investors often find it easy to obtain approval from the government, in addition to cheap bank loans and land as well as preferential tax treatment.
But for industries labeled as "restricted" or "to-be-eliminated," investors will find it difficult to obtain governmental approval for new projects and to maintain operations. For example, such projects would be the first to be cut off at times when electricity is restricted because of power shortages.
The updated list has included new energy, inner-city railway transport equipment and public security devices into the "encouraged" category.
Automatic control systems for vehicles, high-speed precision bearings as well as key parts for new-energy vehicles will also be encouraged.
No other detail were available.
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