A container vessel is seen at Qianwan Container Terminal of Qingdao Port in Qingdao, East China’s Shandong Province on February 25, 2026. Photo: VCG
Editor’s Note:
Currently, China’s economy is steadily advancing along the path of high-quality development, even as domestic and international circumstances become increasingly complex. Some Western media, due to misunderstanding or bias, have repeatedly questioned or even distorted China’s economic development. Accordingly, the Global Times launches the “Q&A on China’s Economy” column to publish opinion pieces to present facts and clarify perceptions.
The new regulation on outbound investment (hereinafter referred to as the “regulation”), released by China’s State Council, which takes effect on Wednesday, has been distorted and misinterpreted by some Western media outlets. Some claim that China is “building an economic fortress” by requiring reviews for Chinese companies seeking to invest overseas. Others claim that China is erecting “a new Great Wall” to “lock as much money, technology and talent as possible inside its own borders.” In fact, rather than signaling “closure” or creating new barriers, the regulation elevates practices that were previously scattered across various departmental rules into a unified administrative regulation, providing a clearer and more stable regulatory framework. This is a hallmark of a mature, well-balanced, and high-standard opening up.
The very first article of the regulation states explicitly that its purpose is to “promote the country’s high-standard opening up and the high-quality development of its outbound investment, protect the legitimate rights and interests of investors and their outbound investment, and safeguard national sovereignty, security and development interests.” The regulation explicitly supports investors in conducting outbound investment activities in accordance with market principles and actively participating in international cooperation and competition. Investors have the legal right to independent decision-making in outbound investment, bearing their own risks and assuming sole responsibility for their profits and losses. The regulation calls for aligning with high-standard international economic and trade rules, advancing high-quality Belt and Road cooperation, promoting international cooperation in industrial and supply chains, and opposing unilateralism and protectionism. None of these reflects “closure or retreat”; rather, they send a clear signal of China’s proactive embrace of economic globalization.
National security reviews aren’t unique to China, in fact they’re a widely accepted international practice. The regulation explicitly calls for establishing a security review system for outbound investment, strengthening oversight of investment activities and transfers that may affect national security, and reinforcing the safeguards for national security.
This is a measure that any sovereign nation should adopt. In recent years, major economies, including the US, have significantly tightened their security reviews of cross-border investment, placing critical technologies, key infrastructure, and sensitive data under enhanced regulatory scrutiny. As China continues expanding its opening up, it is legally reasonable to improve the corresponding review mechanisms. Given China’s continuous innovation in high-end manufacturing and cutting-edge technology sectors, preventing the abnormal loss of key technologies and critical links in industrial chains during investment activities has become both necessary and urgent.
At its core, the regulation seeks both to encourage and protect Chinese enterprises venturing abroad, providing them with a clearer “compass” and a stronger “safety belt.” Over the past two decades, some Chinese companies, particularly private enterprises, have made limited use of professional cross-border legal and financial services when investing in Belt and Road countries. Once confronted with unfair suppression or unreasonable demands overseas, many simply “accepted the bad luck” instead of pursuing legal remedies. By contrast, international practices and advanced approaches emphasize coordinated support from professional investment banks, consultant firms, government agencies, industry associations, and cross-border financial institutions to secure quality projects and bargaining power. The introduction of the regulation is an institutional response to these long-standing pain points.
As China’s opening-up pattern evolves from a model of “domestic production and export for foreign exchange” to a global deployment of production capacity, technology and capital, “going global” is inevitably accompanied by more risks and challenges. The regulation therefore strengthens the government’s service and protection functions with more standardized management requirements: providing “one-stop” support including policy consultation, investment guides, legal assistance, risk warnings, and financial insurance, while coordinating professional institutions, industry associations, and overseas missions to work in synergy, like a “support team” helping companies navigate challenges. This ecosystem-based approach will enhance the ability to respond to risks and international competitiveness of Chinese companies,taking a solid step forward in the transition “from foreign trade to global investment.”
In reality, a few countries have erected numerous discriminatory barriers and imposed unilateral sanctions on Chinese investment, exposing Chinese companies’ overseas assets to risks. In response, the regulation establishes an investment barrier investigation and countermeasure mechanism. When enterprises encounter discriminatory investment barriers or other investment-related operational obstacles, the Chinese authorities may initiate probes in accordance with relevant laws and, where necessary, place relevant organizations and individuals on a countermeasure list.
In this sense, the regulations not only provide a “shield” for risk prevention and control but also equips China with a “sword” for legitimate countermeasures, making the outbound investment management system more complete and operational. Meanwhile, the regulation also contains clear provisions regulating corporate behavior when going global, emphasizing that in conducting outbound investment, they shall comply with laws, regulations and international practices, respect local customs and cultural traditions, observe business ethics, act in good faith and engage in fair competition, fulfill social responsibilities and uphold the national image.
Amid rising global trade protectionism and continued attempts by some in the West to demonize China’s economic achievements, the regulation responds to the challenges of the times with confidence in the rule of law, sending a clear message of China’s unwavering commitment to expanding high-standard opening-up. We welcome foreign companies to invest and conduct businesses in China, and fully support Chinese enterprises in going global, so that all can achieve common development through mutually beneficial cooperation.
