Invest in China: The Yangtze River Delta Region as Promising Land of FDI

The Yangtze River Delta region (hereinafter refer to as the “Delta Region”) stands out as a key investment destination in China, having made significant strides in attracting foreign investment in the past decades. The Delta Region, encompassing Shanghai and the provinces of Jiangsu, Zhejiang, and Anhui, achieved a milestone in 2023 as its economic output surpassed RMB 30 trillion, accounting for a quarter of China’s total economic output. The allure of the Delta Region for foreign investment lies in its abundant talent pool, expansive consumer market, efficient logistics infrastructure, favorable administrative environment, and well-integrated supply chain. Boasting a robust manufacturing sector, a well-structured division of labor, and a high concentration of foreign-funded enterprises, the Delta Region positions itself at the forefront of economic development in China.

Encouraging Establishment Global Partnership

Shanghai, recognized as a prime destination for foreign investors in China, has introduced the Implementation Measures for the Global Partnership Program for Promoting Foreign Investment. This initiative establishes a Global Partnership encompassing professional services, financial capital, industrial chains, business associations, and other entities. Eligible foreign-invested entities are entitled to policy benefits including financial incentives, honorary awards, participation in government-enterprise roundtables, investment promotion seminars, and assistance with work permits. Statistics reveal that in the first half of 2023, Shanghai attracted 2,541 new foreign-invested enterprises, representing a year-on-year surge of 63.3%, with total foreign capital utilization reaching USD 12.777 billion.

Supporting Establishment of R&D Centers

To enhance support for foreign investment development, Jiangsu has released Measures on Encouraging and Supporting the Establishment and Development of R&D Centers for Foreign Investment. These measures include implementing tax policies to boost scientific and technological innovation, streamlining procedures for overseas talent working in China, and enhancing intellectual property rights protection to facilitate the setup of R&D centers by foreign-invested enterprises in Jiangsu. Similarly, Zhejiang has issued the Guidelines for Encouraging the Establishment and Development of Foreign-funded R&D Centers, offering incentives such as support for R&D center establishment, research incentives, tax benefits, land usage rights protection, financial assistance, and talent introduction support, among other preferential policies.

Enhancing Business Environment

To enhance the business environment, Jiangsu has introduced the Measures on Further Optimizing the Foreign Investment Environment and Increasing Efforts to Attract Foreign Investment. These measures aim to boost the headquarters economy for foreign investors, uphold the national treatment of foreign-invested enterprises, enhance protection of foreign investors’ rights, improve investment and operational facilitation, and ramp up financial and tax support. Furthermore, specific actions have been taken in the Delta Region, including: 1) Implementing a Negative List System for Foreign Investment Entry to regulate foreign investment access. 2) Offering comprehensive one-stop services for foreign investors covering entry, residence, daily life, healthcare, education, and other needs. 3) Actively promoting cross-border human resources cooperation, establishing an international professional qualification recognition mechanism for high-end talents, and facilitating foreign investment entry and growth in the Delta Region to attract more foreign investment.

Strengthening Foreign Investment Support

To enhance the effectiveness of foreign investment support, the Delta Region has bolstered several safeguards. These include boosting investment support through RMB settlement, expanding credit insurance support for offshore investment, accelerating the establishment of a comprehensive one-stop service platform for international investment, and underlining the critical role of legal services in foreign investment. These initiatives aim to amplify the appeal of the Delta Region to foreign investors and stimulate economic development vitality.

In conclusion, the Delta Region continues to be a prominent choice for foreign investors in China. The Delta Region incentivizes the establishment of foreign-invested global partners and R&D centers, while consistently improving the business environment and strengthening policy support to enhance its allure. As global investors seek new opportunities in the evolving landscape of international investment, the Delta Region remains a highly promising destination in China.


The above content is provided for informational purposes only. The provision of this article does not create an attorney-client relationship between D’Andrea & Partners and the reader and does not constitute legal advice. Legal advice must be tailored to the specific circumstances of each case, and the contents of this article are not a substitute for legal counsel.

Riccardo Verzella Riccardo Verzella

Riccardo Verzella

Senior Associate
Riccardo Verzella, a highly qualified Italian lawyer, has been based in Shanghai, China since January 2020.

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