In recent years, the local government units in China have been vigorously improving the business environment. According to the World Bank's Business Environment Report for 2018, China ranked 78th in the global business environment assessment, and its score increased by 0.4 from the previous year. From 2013 to 2017, the rank of China has been increased by 18 from the World Bank's Business Environment Report, which is closely related to the efforts to improve the business environment in recent years.

To a large extent, the business environment is the attraction of investment. This attraction is divided into two levels: the first is the traditional type, such as the low labor costs, the government grants tax incentives, and the perfect infrastructure; the second level is that the incentives are not obvious, but there are more opportunities in the region. The degree of legalization is higher, and the rule of law environment is more reassuring for companies. China is shifting from the first level to the second level, so that the release the investment attraction with stronger, more stable, more sustainable and predictable.

Then, as we all know, the transformation is a process that needs to be done. Each transformation will bring a period of relative instability, and both the country and enterprises need some time to accept this transformation. To a certain extent, this is why some people think that the current Chinese business sentiment are dropping. In fact, it is not that China's business environment has deteriorated, but China is working hard to create a more favorable business environment for enterprises. However, the process of climbing a mountain is bound to be difficult, but the scenery on the top of the mountain is always more beautiful.

For these, what efforts has be made by China?

I. Simplify approval and further optimize the business environment

This year, China has simplified the administrative approval process for setting up enterprises on the large extent, further reducing the administrative approval of market access, improving the effectiveness of government services, and shortening the time to start a business.

II. Increase the protection of property rights

In order to protect the healthy development of enterprises in China, in recent years, the Chinese government has continuously promoted the revision of the Patent Law, introduced punitive damages measures, and increased the punishment for various types of violations. The relevant data reports also show the effectiveness of China's Intellectual Property Protection. (Social satisfaction with intellectual property protection has increased from 63 in 2012 to 76 in 2017.)

III. Establish a Business Evaluation Mechanism

China is planning to establish the “Business Evaluation Mechanism” to objectively evaluate the true state of the business environment at each stage of China, as well as the degree of progress in the improvement process, as well as improvements that need to be strengthened.

IV. The development of the free trade zone

Now, the number of China's Free Trade Zones has increased to 12. In addition to the existing 11 Free Trade Zones(Shanghai, Tianjin, Guangdong, Fujian, Shaanxi, Shanxi, Zhejiang, Henan, Liaoning, Sichuan, Hubei), Hainan Free Trade Zone has been announced in this month. The China (Hainan) Pilot Free Trade Zone, approved by the State Council, will cover the whole island of Hainan. The government plans to make the zone an international tourism and shopping center, as well as offer services and support for development of the Belt and Road Initiative and other national strategies.

And issued the "China (Hainan) Free Trade Pilot Area Overall Plan." This "Plan" shows that it will speed up the construction of a new open economy system and greatly relax the access to foreign capital. The Free Trade Zone will deepen the opening up of modern agriculture, high-tech industries, and modern service industries, and increase openness in key areas such as seed industry, medical care, education, tourism, telecommunications, Internet, culture, finance, aviation, marine economy, and new energy vehicle manufacturing.

V. The negative list of foreign investment access

China has revised the "Special Management Measures for Foreign Investment Access (Negative List) (2018 Edition)", and officially implemented it on July 28 this year. In this list, China has increased its openness to the industry, it introduced open measures in 22 areas, and the number of restrictions has been reduced to 48(means it reduced by nearly a quarter), and introduced open measures in 22 areas. Moreover, the Negative List of foreign investment in the 2018 edition draws on the style and form of the Negative List of the Pilot Free Trade Zone, and is independent from the Foreign Investment Industrial Guidance Catalogue and published separately. According to the "National Economic Industry Classification", it is listed the major foreign capital restrictions such as equity ratio and executive requirements.

As mentioned above, China is actively creating the more favorable business environment for enterprises that invest in China.