China promises to make business, life in Shanghai easier for foreign companies
Shanghai has vowed to make setting up mobile payments easier for expats on short visits, part of the city’s efforts to make itself more alluring to foreign businesses and reassure investors.
Solutions have been proposed by the Shanghai headquarters of the People’s Bank of China, the central bank, to help foreigners use their credit cards to make purchases and allow them to withdraw renminbi, the local currency, from ATMs throughout the city, state media outlet The Paper said.
During a September 15 talk with executives from top multinationals, including Deloitte and HSBC, Shanghai market administration officials and Shanghai representatives from the PBOC listened to complaints and discussed how to solve their problems. One suggestion was the resumption of point of sale terminal transactions at major retailers to make foreign credit cards more easily usable.
Shanghai’s discussion session with foreign firms, and the promises therein, marks another instance of a locality which relies on foreign investment scrambling to reassure its constituents.
Restrictions on cross-border data flow, a new anti-espionage law and a string of police raids at US consultancies have dented investor confidence.
A June report by the European Union Chamber of Commerce in China found one in 10 EU companies had moved their Asia headquarters or other offices out of mainland China in the past five years, or was planning to do so.
Shanghai has identified 195 tasks to improve the environment for businesses, and 51 of them will be completed in OctoberLu Aiguo, Shanghai
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For Shanghai, the need to rebuild confidence is urgent thanks to lingering unease after the lockdown from March to June last year. Its more than 70,000 foreign-invested firms contributed one-third of fiscal revenues, half of its industrial output and a quarter of its 4.46 trillion yuan (US$620 billion) GDP in 2022, Shanghai government statistics show.
“Shanghai has identified 195 tasks to improve the environment for businesses, and 51 of them will be completed in October,” said Lu Aiguo, chief of the business environment construction division of Shanghai’s Municipal Development and Reform Commission.
The financial capital has also promised to make law enforcement arrangements more lenient, sparing foreign companies fines or other penalties if their offences are light.
Local media quoted the city’s Market Supervision Administration as saying there are already 31 lists covering 26 sectors, and companies have been exempted from penalties in applicable situations since 2019.
Officials in charge of Shanghai’s Lingang Free-Trade Zone also revealed in the September meeting that “five scenarios” involving step-by-step supervision of low- to medium risk cross-border data transfers would be implemented.
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Other concerns and hopes raised by foreign companies included fairer market access for financial and pharmaceutical companies, flexible implementation of financial market regulations like capping the income for senior executives as well as more tailor-made measures for small- and medium-sized businesses, The Paper said.