China on Monday announced a master plan for six new pilot Free Trade Zones (FTZs) in a strategic move to press ahead with reform and opening up in the new era.
The new pilot FTZs will be located in the six provincial-level regions of Shandong, Jiangsu, Guangxi, Hebei, Yunnan and Heilongjiang, according to the plan released by the State Council.
This will bring the total number of the country’s pilot FTZs to 18, which serve as pioneers of the country’s reform and opening up as they test new styles of foreign investment management, trade facilitation and transformation of government functions to better integrate the economy with international practices.
After China started piloting FTZs in Shanghai in 2013, the country had established 11 more in its coastal regions including Guangdong and Fujian and inland provinces such as Shaanxi and Sichuan. Earlier this month, the Shanghai pilot free trade zone was expanded, with the addition of a new section.
With the new zones, China’s pilot FTZs now cover all the country’s coastal provincial-level regions, said Wang Shouwen, vice minister of commerce.
In this way, the FTZs can develop in a less fragmented approach and better connect with each other, which will help advance coordinated and integrated development, according to Han Jian, a professor at Nanjing University Business School.
It is also the first time that the country has set up pilot FTZs in the country’s border areas, a move that will facilitate the country’s economic and trade cooperation with neighboring countries, Wang said.
The new FTZs will have more autonomy in making policies in trade and investment facilitation, financial services for the real economy, talented people management and institutional innovation, he said.
Authorities should draw lessons from the pilot programs and accumulate experience for reform practices that could be replicated and promoted, according to the plan.
China’s FTZs have a proven track record in attracting foreign investment. In the first half of this year, China’s 12 current FTZs have attracted foreign investment of nearly 70 billion yuan (about 10 billion U.S. dollars), accounting for 14 percent of the country’s total, Wang said.
“With institutional advantages and better business environments, the FTZs are at the forefront in attracting foreign investment,” Wang said.
“We believe the new FTZs will also become investment hotspots,” he said.