China’s State Council unveils plan for advancing institutional opening-up of Shanghai Pilot Free Trade Zone

70

9th December 2023 – (Shanghai) The State Council issued a comprehensive plan for advancing the Shanghai Pilot Free Trade Zone (FTZ). This step, aligned with high-standard international economic and trade rules, was announced during a regular press conference held by the State Council Information Office on Friday. The plan aims to provide detailed insights, ranging from cross-border data transfer to security management, marking a pivotal development in the ongoing efforts to enhance China’s economic openness and facilitate investment and trade.

Experts have lauded the plan as a positive signal, demonstrating the resolute commitment of both central and local governments to expand opening-up measures. Additionally, the plan is anticipated to provide significant policy support for enterprises actively engaging in the development of Shanghai.

The introduction of the general plan coincides with the 10th anniversary of the establishment of the Shanghai FTZ, further refining the area’s development blueprint.

During the regular press conference, Tang Wenhong, assistant minister of commerce, outlined the government’s focus on seven key aspects, presenting 80 specific measures that actively and comprehensively align with high-standard rules. The plan involves deepening reforms in vital areas such as domestic and foreign trade, finance, and technology to advance high-level institutional opening-up.

Specifically, the seven key areas encompass accelerating the opening-up of service trade, enhancing the level of liberalization and facilitation in goods trade, implementing high-standard digital trade rules, strengthening intellectual property protection, advancing reforms in the government procurement sector, promoting the reform of relevant post-border management systems, and reinforcing the construction of a risk prevention and control system.

Tang emphasized that the Ministry of Commerce, in collaboration with Shanghai and relevant government departments, will expedite the implementation of pilot measures, aiming to swiftly unleash the dividends of reform and opening-up. The objective is to generate pilot experiences that can be replicated and promoted, explore new paths, and accumulate fresh insights in the comprehensive deepening of reforms and expansion of openness.

Furthermore, Deputy Mayor of Shanghai Hua Yuan highlighted plans to encourage financial institutions and payment service providers to adopt international advanced standards for electronic payment systems. The city intends to implement measures such as cross-border authentication and electronic identification of digital identity as part of its commitment to enhance systematic reform and opening-up.

The Shanghai FTZ has made significant progress over the past decade, with notable achievements in business revenue and enterprise operations. Huang Feng, head of Shanghai Foreign Investment Association, highlighted that the total operating income of enterprises in the FTZ exceeded 2 trillion yuan ($280 billion), accounting for a substantial portion of the total business revenue of the top 255 enterprises registered in Shanghai.

Xi Junyang, a professor at the Shanghai University of Finance and Economics, highlighted the impact of the policies and support provided to the Shanghai FTZ over the past decade, emphasizing their gradual implementation and significant progress. He noted that the experience gained from the Shanghai FTZ is being adopted nationwide, underscoring its far-reaching influence on economic practices and policies.

According to Bai Ming, a researcher at the Chinese Academy of International Trade and Economic Cooperation, the general plan is a significant step towards providing institutional guarantees for companies and reinforcing China’s commitment to economic openness. He emphasized that the plan offers assurance to foreign partners, encouraging their increased involvement in China’s economic development.