Chinese government is set to ease restrictions on foreign investments in a number of industries, including the shipping sector, in Shanghai’s free-trade zone, The South China Morning Post reports.
Earlier this month China’s Premier Li Keqiang’s said that market forces ” would be allowed to play a dominant role in the FTZ.”
Over twenty business sectors are to be opened to foreign investments in the FTZ, a circular from the State Council said.
With the investment cap raised from 49% to 51%, overseas investors will for the first time be allowed to possess a controlling stake in joint-venture shipping agencies.
“Liberalisation of the shipping-agency sector has been discussed for more than a decade,” said Xiong Hao, assistant general manager at Shanghai Jump International Shipping.
The shipping industry officials hope the cap increase will encourage the biggest names in shipping to expand in China, and to take advantage of the expanding business opportunities offered at the Yangshan deep-water port, which is within the FTZ.
However, some analysts warn that the changes are symbolic rather than concrete, saying that it would be difficult for foreign companies to set up business in the FTZ on the account of its limited size.
Currently, newly set up foreign businesses, without taking Hong Kong-based businesses into account, constitute only 5% of the total at the FTZ.