China Trying To Persuade Foreign Firms

China Trying To Persuade Foreign Firms To Remain In HK

HONG KONG – After foreign direct investment (FDI) growth rates significantly contracted in April and May due to harsh COVID-19 restrictions, Beijing is ramping up its efforts to persuade multinational corporations to remain in Hong Kong and the Chinese mainland, reported Asia Times on Monday morning (27 June, SGT).

In early-June 2022, Beijing’s Liaison Office met with representatives of different chambers of commerce in a closed-door meeting in Hong Kong to get their views on how to revive the local business environment of Hong Kong and what they require to be able to do more business in mainland China.

Hong Kong authorities stated that the government is actively looking to reduce the quarantine period for inbound travelers to five days from seven days previously. In comparison, foreign travelers can enter Europe without a quarantine period or in many countries even with proof of vaccination.

In particular, the Chinese government’s special representative, Wu Hongbo, embarked on a low-profile trip to seven European countries between late-May and early-June in a bid to enhance China-Europe ties as well as promote the easing of quarantine rules in Hong Kong and mainland China.

Moreover, Wang Danfeng, an economic official at Beijing’s Liaison Office in Hong Kong, held a 90-minute meeting with a group of representatives of foreign chambers of commerce in early-June.

In the meeting, Chinese officials asked about the problems multinational firms faced in Hong Kong. However, they didn’t reply to the calls for a complete withdrawal of the quarantine rules made by the foreign chambers.

The direct talks between the Liaison Office with overseas investors in Hong Kong was unprecedented as it’s the responsibility of the Hong Kong government to deal with business problems.

Beijing talks with foreign chambers of commerce comes after data from the Ministry of Commerce showed that the annual growth of China’s FDI eased to around 6 percent for both April and May from was 12.9 percent in March, 31.7 percent in Q1 2022, and 45.2 percent during the first two months of the year.

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