The Need For China To Pursue Openness For The Long Term – Analysis


By He Jun

While the policy direction of China has never denied opening up to the outside world, even various government documents explicitly emphasize the need to do so, and the official Chinese media has never promoted a stance against such openness, the very issue of the country being open to the world has been a concern to some. This is particularly true regarding the openness of China in the market (in terms of domestic and foreign investment), and business communities are anxious about it. Within the country itself, there is mixed public opinion, with some that are vocal against such a matter.

Why are these seemingly contradictory issues arising in China now? This is closely related to the current complex situation. Anti-globalization and geopolitical conflicts have created a different development environment. The United States and its allies have imposed various economic, trade, technological, financial, and cultural restrictions on China, aiming to decouple the country from the world. Faced with external pressure, China has taken some short-term countermeasures and has begun adjusting its development strategy. In the face of these changing circumstances, the very issue of opening up has become a crucial matter.

According to ANBOUND’s macro research team’s tracking and research, surveys of foreign-funded and China’s domestic enterprises, as well as our communication with government officials at different levels, have revealed several new problems in China’s openness to the outside world. These can be summarized as follows.

First of all, there have been some changes in the formulation of China’s national policies and departmental policy-making. While as mentioned earlier, Chinese policymakers have never denied opening up at the strategic level and in its major policies. However, at the level of specific departments, there have been some different approaches to openness. For example, in recent years, China has placed a high emphasis on independent innovation and self-reliance in policy terms, introducing new policies in areas such as market access and government procurement. These policy concepts, inclinations, and specific requirements, which appear as normal changes in China’s perspective, have raised concerns among some foreign investors if such changes in various sectors imply a shift in the country’s approach to openness.

Secondly, there has been a significant increase in requirements for national security and industrial security in some industries or market sectors. For instance, China has raised the level and restrictions in terms of national, technology, data, information, and other aspects of security. Of course, these changes in security are not one-sided. Internationally, several countries have been raising their standards in such areas and exerting tremendous pressure on China. The changing external environment has played a significant role in China’s policy adjustments. Undeniably, certain such measures and enhancements in security within China have triggered concerns among some foreign business communities.

Thirdly, there have been some contradictions between policy documents and their actual implementation. In fact, in many policies such as national treatment, market access, negative list management, financial sector opening, and the opening of certain manufacturing sectors, China has increased its efforts to promote genuine national treatment in the domestic market in recent years. However, due to policy changes and the discretion of implementing agencies, some implementation measures have raised concerns in specific areas and during certain execution processes. This has especially led to doubts about the country’s openness among foreign investors. In reality, such worries not only originated from the execution of policy departments but have also gradually formed a subconscious vigilance towards openness and foreign cooperation among some market entities and at the social level. To cite an example, in some sectors, although asset restructuring and corporate mergers and acquisitions are permitted within the policy framework, concerns from enterprises and policy regulatory departments have hindered some market behaviors that comply with the policy. In certain industries (such as telecommunications), there has been a noticeable increase in requirements for the domestication of software, hardware, databases, and other aspects compared to the past.

Fourthly, there have been changes in Chinese media and public opinion, and the current dominant tone is no longer focused on openness. The current public discourse highly emphasizes national security, independent innovation, and domestic circulation, leading to intense debates on similar topics at the societal level. At the same time, the foreign media environment has also become unfavorable to China, contributing to the deterioration of the external media environment.

Finally, some government officials and social systems in China are gradually feeling unfamiliar with opening up and providing services to the outside world. If there are deviations in China’s policies and their implementation regarding openness, and if the media environment is unfavorable to it for a prolonged period, it is possible that some government officials, policy researchers and makers, the social public opinion, and even the market may gradually become unfamiliar with openness. If this situation occurs, it would not be favorable for China.

It is worth noting that these changes in the domestic and international environment have given rise to an inaccurate understanding of China’s policy of openness, and even some distorted perceptions. Foreign investors who are familiar with the Chinese market have expressed anxieties regarding the current portrayal in Western media, which presents China as disregarding international norms and flaunting its military capabilities. Such perspectives can shape public opinion and pose challenges to China’s reform and opening up. At the same time. China itself needs to remain vigilant about the emergence of certain governmental, societal, and corporate developments that may be contradicting the policies emphasized by the central government.

It is therefore evident that China’s renewed emphasis on openness is not mere rhetoric or superficial gesture. This encompasses practical considerations that bear crucial implications for its future economic development, international cooperation, foreign investment, foreign trade, and global scientific and technological exchanges. Researchers at ANBOUND have previously warned of the potential exclusion of China from the upcoming global process of globalization, highlighting the possibility of the country being left out by the West. Therefore, in the face of the complex and evolving environment, it is imperative for Chinese policymakers to steadfastly uphold the principles of reform and opening up, transforming the strategy of openness into a comprehensive domestic policy framework. Embracing openness is not only a strategic matter but also an effective response to the pressure of being decoupled.

Final analysis conclusion:

The development practice of the past 40 years has proven that openness is the strategic approach that China should continue to adopt. With the unprecedented changes in the world, in the short term, the country is confronted with numerous and complex external pressures, which pose greater development challenges than before. It is precisely at such times that China should remain open. ANBOUND has consistently emphasized the importance of long-term thinking, stressing that the country can stay on the right path of development by steadfastly maintaining its commitment to openness.

He Jun is a researcher for ANBOUND


Anbound Consulting (Anbound) is an independent Think Tank with the headquarter based in Beijing. Established in 1993, Anbound specializes in public policy research, and enjoys a professional reputation in the areas of strategic forecasting, policy solutions and risk analysis. Anbound's research findings are widely recognized and create a deep interest within public media, academics and experts who are also providing consulting service to the State Council of China.

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