China to spur overseas investment by private firms
BEIJING, July 3 – Chinese private firms investing abroad will get new policy support, including tax relief and easier access to credit, the country’s top planning body said today, to balance capital flows and move up the global value chain.
The government will provide tax relief for private firms that have already paid income tax in foreign countries, according guidelines issued by the National Development and Reform Commission (NDRC) on its website, www.ndrc.gov.cn.
In addition, Chinese banks will provide more loans and export credit to help with mergers and acquisitions, the NDRC said, adding that the firms will be allowed to issue stocks and bonds, including yuan denominated, in overseas markets.
China is particularly interested in energy and resource investment overseas as well as high-tech and advanced manufacturing industries to help “develop domestic new strategic industries, upgrade and restructure industries”, according to the guidelines.
China, with US$3.3 trillion (RM10.40 trillion) in foreign exchange reserves – the world’s largest – is stepping up the decade-old “go out” aimed at smaller firms, including making it easier to buy foreign currencies to complete deals, the NDRC said.
Overseas investment has been dominated by big Chinese state-owned firms, which accounted for 80 per cent of the accumulated outflows totalling US$1.5 trillion at the end of 2011. – Reuters
