China has introduced a new set of policy measures aimed at encouraging foreign-funded enterprises to reinvest in the country.
The measures, detailed in a circular jointly released by seven key government departments, including the National Development and Reform Commission (NDRC), Ministry of Finance, Ministry of Natural Resources, Ministry of Commerce, People’s Bank of China, State Taxation Administration and the State Administration of Foreign Exchange, cover a wide range of areas from project support to financial innovation.
The circular outlines streamlined procedures for foreign investors setting up new entities, stronger support for project implementation and enhanced access to tailored financial products and services. It also introduces pilot programs for investment information reporting, promotes better information sharing among authorities and plans to improve evaluation methods for promoting foreign investment.
“These seven departments each oversee different but complementary areas,” said Liu Yue, Deputy Director of the NDRC’s Institute for International Economic Research. “Together, they can ensure a coordinated and effective rollout of policies that meet both macro-level goals and enterprise-level needs.”
For example, the NDRC is responsible for crafting foreign investment strategies and approving major projects; the finance ministry and taxation authorities design preferential financial and tax policies; the natural resources ministry manages land allocation and flexible leasing options; and the central bank and the foreign exchange administration oversee cross-border capital flows and foreign exchange settlements.
To make these measures more impactful, Liu stressed the importance of coordinated efforts at both the central and local levels, and from both the demand and supply sides.
On the demand side, she noted that China’s push for large-scale equipment upgrades and a nationwide campaign to replace old consumer goods have already helped fuel market momentum and created new opportunities for foreign investors. At the same time, China’s robust export performance in the first half of the year has enabled both foreign and domestic enterprises to tap into global markets and expand their international footprint.
On the supply side, deeper collaboration between foreign and Chinese firms is critical for long-term success. She indicated that foreign enterprises should not only invest, but integrate, working with local partners in R&D, manufacturing, and innovation. She cited the example of a U.S. car maker that co-developed an intelligent control system with a Chinese supplier. The system was later used in a vehicle model that became a hit with American consumers.
Official data form the Commerce Ministry shows the growing confidence of foreign investors. In the first five months of 2025, over 24,000 new foreign-invested enterprises were established in China, marking a 10.4 percent year-on-year increase. Besides, high-tech sectors have become the major driver of actual use of foreign investment, accounting for over 30 percent.
China unveils new measures to boost foreign reinvestment
