China Cuts Red Tape

If you want things to change, you can talk about it or you can do something about it.  China is taking the first steps to action in foreign investment rules by these proposed draft laws.  Unifying regulations, scaling back restrictions and beginning to regulate the variable interest entities that are used to circumvent foreign ownership in China (see this link for information on variable interest entities: VIE Definition According to Investopedia).  These steps are essential to encourage more FDI into China which has fueled growth there for many years now.  In the last few years foreign firms have become more and cautious with investment into China because of the regulations that are in place.  

Make no mistake, these laws are not unique to China, in the US we have them too, including laws on which sectors a company can invest in to, who can make the investments and how their employees can come here to work (to name a few of our regulations).  We could use some changes here too.  In the meantime, you can read more on what is happening in China at the link below from Bloomberg.

China Wants to Cut Red Tape