Promote the integration of trade and investment

The Outline of the 15th Five Year Plan for National Economic and Social Development of the People's Republic of China (hereinafter referred to as the "Outline") proposes to promote the integration of trade and investment, and guide the rational and orderly cross-border layout of industrial and supply chains. This marks a new stage of deep integration and coordinated linkage between trade and investment in China's opening-up to the outside world. The process of China's opening-up to the outside world is itself a history of mutual promotion and coordinated development of trade and investment. In the early stages of reform and opening up, the "two ends outside" processing trade attracted a large amount of foreign investment, forming the first interactive peak between trade and investment attraction. After joining the WTO, China has become both the "world factory" and an important outward investor in the process of deeply integrating into the global value chain. In recent years, China has continuously explored the collaborative model of "trade+investment+industry+infrastructure" in practice. The Outline clearly proposes to promote the integration of trade and investment, which is a systematic refinement of past successful experiences and a strategic upgrade of the open mode in the new development stage. It is not only an active response to the restructuring of the global industrial and supply chains, but also an important path to build a new development pattern and promote high-quality development.

The strategic significance of promoting trade and investment integration

Promoting the integration of trade and investment is an active action in response to the new trend of economic globalization and the profound changes in the global economic and trade pattern.

It is an inevitable requirement to actively connect with international high standard economic and trade rules, promote the compatibility of domestic and international rules, regulations, management, and standards, and create a transparent, stable, and predictable institutional environment. In recent years, the evolution of international economic and trade rules has shown new characteristics of deepening from traditional border measures to post border rules, expanding from goods trade to service trade and investment, and evolving from single dimensional trade rules to integrated trade and investment rules. The new generation of regional economic and trade agreements, such as the Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP) and the Digital Economy Partnership Agreement (DEPA), deeply bind trade and investment rules. Promoting the integration of trade and investment requires us to accelerate the reform of relevant domestic management systems, benchmark against international high standard economic and trade rules, and achieve higher levels of institutional openness in areas such as investment access, intellectual property protection, competition policy, digital economy, and environmental standards.

Key measures to smooth the domestic and international dual circulation, enhance the endogenous power and reliability of the domestic circulation. Trade and investment are important links connecting domestic and international markets and resources. Traditionally, trade mainly involves the cross-border exchange of goods and services, while investment mainly involves the cross-border allocation of production factors. Promoting trade and investment integration means breaking down policy barriers and institutional barriers between the two, and promoting the free and convenient flow and optimization of production factors such as goods, services, capital, technology, talent, and data on a global scale. On the one hand, this is beneficial for Chinese enterprises to better utilize global resources for technological innovation and industrial upgrading, and to enhance the modernization and resilience of domestic industrial and supply chains; On the other hand, by optimizing the global layout, it is possible to more effectively stabilize and expand the external market, enhance the stability and competitiveness of the international circulation, form a strong driving force for the domestic circulation, and ultimately achieve the coordinated development of the two circulations.

The strategic path of cultivating new advantages in international cooperation and competition, and promoting high-quality economic development. China's economic development has shifted from a stage of high-speed growth to a stage of high-quality development. Promoting the integration of trade and investment means that we should shift from a single mode dominated by the export of goods trade to a combination of trade in goods and services and cross-border capital investment, drive trade growth through investment layout, and then use trade networks to deepen investment roots, forming a virtuous circle of "expanding the market through investment and promoting investment through trade", driving the export of domestic high-end intermediate goods, advanced equipment and technical services, and promoting Chinese standards and Chinese brands to the world. At the same time, it is conducive to deep integration into the global innovation network, faster absorption of international advanced technology and management experience, reverse promotion of domestic industrial upgrading, and ultimately shaping new international competitive advantages centered on innovation, quality, brand, and service.

The core essence of promoting trade and investment integration

Promoting the integration of trade and investment is not a simple combination of trade and investment policies, nor is it a mechanical combination of trade and investment activities. It is based on the inherent logic of deep integration of the global economy, and promotes the systematic, deep level, and institutional integration and mutual promotion of the two in terms of institutional design, industrial interaction, subject behavior, platform functions, and other aspects. General Secretary Xi Jinping pointed out that "we must continue to deepen the opening up of factors such as goods, services, funds, and talents, while steadily expanding the institutional opening up of rules, regulations, management, standards, etc.", which provides fundamental compliance for accurately grasping the scientific connotation of trade and investment integration. The core essence is to implement the requirements of "integrated promotion" and "institutional openness" in multiple dimensions such as institutional rules, industrial chains, open platforms, and emerging fields, and to build an organic whole that promotes synergy and mutual promotion.

Promote the integration, connection, and innovation of institutional rules, and consolidate the foundation of institutional openness. This is a prerequisite and guarantee for promoting integration. In response to the situation where trade management and investment management were relatively independent and policy coordination was insufficient in the past, efforts should be made in the future to enhance the coordination level of domestic laws, regulations, regulatory standards, and management systems, create a stable, transparent, and predictable policy environment, so that when enterprises engage in cross-border operations, trade facilitation measures and investment protection, market access, fair competition, intellectual property protection and other rules can be seamlessly integrated and coordinated, minimizing institutional transaction costs, promoting the free, orderly and safe flow of various factors across borders, and truly realizing the promotion of reform and development through opening up.

Promote the deep integration and collaboration of industrial and supply chains, and strengthen the linkage of micro entities. This is the physical support and practical foothold of trade and investment integration, which must follow economic laws and guide enterprises to optimize resource allocation on a global scale. On the one hand, support enterprises to establish production bases, research and development centers, and regional headquarters overseas through green space investment, mergers and acquisitions, etc., in order to drive the export of related equipment, components, technology, and services domestically, and achieve the goal of creating trade through investment and driving trade. On the other hand, enterprises are encouraged to rely on the trade channels, brand reputation, and customer base formed by long-term cultivation in overseas markets, and make timely localized investments to upgrade from product exports to production capacity cooperation and "technology+standards+services" output, that is, to guide and leverage investment through trade, and enhance the linkage effect between domestic and international markets and resources. This deep interaction based on the industrial chain value chain is the key for enterprises to improve the efficiency of global resource allocation and climb to the upper end of the value chain.

Promote the integrated reform and empowerment of open platforms, and create a leading zone for integrated trade and investment development. The pilot free trade zone and Hainan Free Trade Port are the "experimental fields" for China's reform and opening up in the new era. To promote the integration of trade and investment, it is necessary to make good use of these "test fields", give these platforms greater reform autonomy, and take the lead in conducting innovative experiments on the linkage between trade regulatory and investment management systems. We will focus on conducting integrated reform explorations in areas such as cross-border data flow, financial openness and innovation, intellectual property protection, competition policy, and environmental protection, and build a "one-stop" service system that integrates functions such as trade facilitation, investment freedom, financial openness, transportation exchanges, and personnel entry and exit. Upgrade major exhibition platforms such as CIIE, CIFTIS, and CIFIT from a single display and trading function to a comprehensive platform that integrates commodity and service trading, investment promotion, policy release, and forum dialogue, providing a high-level carrier for the integrated development of trade and investment.

Promote synchronous exploration and rule building in emerging fields, and seize the commanding heights of future development. In emerging fields such as digital economy, green and low-carbon, artificial intelligence, and biotechnology, trade forms and investment models are highly integrated and the boundaries are blurred. To promote the integration of trade and investment, it is necessary to simultaneously carry out top-level design of trade cooperation and investment layout in these cutting-edge fields, actively participate in and even lead the formulation and co construction of relevant international rules, standards, and agreements. For example, in the field of digital trade, synchronous consideration of cross-border data flow rules and digital industry investment layout, and collaborative promotion of green product trade and investment cooperation in green technology and green finance in the field of green economy.

Practical Path to Solidly Promote Trade and Investment Integration

Promote seamless integration of institutional rules and build a solid foundation for institutional openness. Establish a cross departmental collaboration mechanism, coordinate and coordinate departments such as commerce, customs, foreign exchange, and development and reform, and eliminate policy barriers and redundant supervision. Actively benchmarking against high standard international economic and trade rules such as CPTPP and DEPA, and conducting integrated experiments on investment access, digital trade, competition neutrality, environmental standards, etc. on open platforms such as free trade pilot zones. Timely revise and optimize the Foreign Trade Law of the People's Republic of China, the Foreign Investment Law of the People's Republic of China, and related supporting regulations, enhance the synergy and modernity of the legal system, strengthen intellectual property protection and cross-border commercial dispute resolution mechanisms, and provide a stable, transparent, and predictable policy environment for enterprises.

Deepen the integration of industrial and supply chains, and enhance the global layout coordination capability. Supporting enterprises to drive the export of intermediate goods, equipment, technology, and services through outward investment, achieving the goal of "investment driven trade"; Utilize existing trade networks and market demand to guide enterprises to carry out localized investment operations, achieving the goal of "attracting investment through trade". Focus on supporting enterprises to jointly build a national integrated cooperation park in the "the Belt and Road", promote the combination of infrastructure and the "soft and hard connectivity" of rules and standards, and create a number of trade and investment promotion demonstration projects. Improve the global monitoring and risk warning mechanism for key industrial and supply chains, and enhance the resilience and security of the industrial chain through diversified investment layout.

Strengthen the integration role of open platforms and build a collaborative carrier for trade and investment. We will take the lead in promoting comprehensive institutional innovations such as cross-border data flow, financial openness, and intellectual property protection in pilot free trade zones and Hainan Free Trade Port, and create a 'digital free trade zone'. Promote the upgrading of exhibition platforms such as CIIE, CIFTIS, and CIFIT, and transform from a single trade or investment promotion platform to an integrated comprehensive platform of "exhibition, negotiation, investment, strategy, and discussion". Using digital technology to integrate customs clearance, logistics, payment, tax refund and other links, building a smart port and online comprehensive service platform, and improving the level of trade and investment facilitation.

Expand the integrated layout of emerging fields and cultivate new driving forces for integrated development. Synchronize the promotion of trade cooperation and investment layout in emerging fields such as digital trade, green economy, and artificial intelligence, and promote the co construction and sharing of relevant rules, standards, and infrastructure. Support digital platform enterprises to carry out overseas investment and localized operations, and improve the rules for digital product trade and cross-border data flow. Establish a sound green standard, certification, and labeling system, guide foreign investment in green and low-carbon fields, and encourage enterprises to participate in overseas investment in new energy and environmental infrastructure. Innovate cross-border finance and supply chain finance service models to provide full cycle financial support for integrated trade and investment activities of enterprises.

Create a market-oriented, rule of law, and international first-class business environment, and improve the service guarantee system. Vigorously promote the integration and construction of the "single window" function, promote the simplification of the trade and investment approval process, and shorten the approval time limit. Strengthen the cultivation of composite talents who are proficient in international rules and trade investment business. Give full play to the functions and roles of intermediary organizations such as chambers of commerce, industry associations, consulting and legal institutions, and provide integrated professional service support for enterprise development.