Beijing’s key zones for a business-friendly environment
Beijing's relaxed foreign investment rules and tax incentives are expected to boost domestic and foreign trade. In 2013, they began the construction of two zones that aimed to open up the service sector to boost overall economic growth. Beijing has been a pioneering city in developing a national integrated demonstration zone for greater openness in the service sector, which has led to an increase in the contribution of the service sector to the total GVA in Beijing from 77% in 2013 to 82% in 2022.
The decision to lift the zero-COVID policy and reopen the international border in January 2023 facilitated the entry of foreign tourists, which will promote growth in all related sectors, including aviation, hotel, restaurant, transport, and retail trade. The Chinese government is allowing more private investment in various industries, and the number of industries with restrictions on spatial administrative measures has come down from 151 in 2018 to 117 in 2022, primarily influencing the financial sector.
Beijing has relaxed foreign investment rules, tax incentives, and talent support under the two zones to attract domestic and global investors. Tax insurance incentives have been added to facilitate overseas talents, and tax exemption on technology transfer has also been increased. Beijing encourages foreign scientists to lead in government-supported science and technology projects, and foreigners are also allowed to start and obtain shares in domestic-funded companies using their permanent residence ID cards. The city is expected to experience economic growth in the coming years due to high-value industries in science and technology, information services, finance, education, and professional services, with substantial research and development expenditure bonded by the local government and favourable business policies aligned with the national agenda.
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