Some foreign media alleged that "China does not need foreign enterprises" or "China does not welcome foreign enterprises". Is the claim true? Certainly not. Recently Chinese Premier Li Qiang presided over a State Council executive meeting that outlined measures to boost domestic consumption and approved an action plan to stabilize foreign investment in 2025. It encouraged foreign capital to undertake equity investment in China, and urged efforts to optimize rules and procedures for foreign mergers and acquisitions.

In an interview with China Youth Daily, Cai Tongjuan, Director of the Macro Research Department and Research Fellow of the Chongyang Institute for Financial Studies (RDCY) said that the implementation high-standard "bringing in" and high-level "going out" is an important strategy for China at the stage of high-quality development. China's emphasis on "bringing in" and "going out" does not mean that China excludes foreign investment, but hopes to attract foreign investment to participate in China's economic transformation and high-quality development through a more open market, while encouraging Chinese enterprises to go global and participate in international competition.

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Cai noted that foreign investment plays an important role in promoting "the formation of a new development pattern that takes the domestic circulation as the mainstay while internal-external dual circulation reinforce each other". Domestic and international circulation are not mutually exclusive but complementary. Foreign investment is an important bridge connecting the domestic and international markets in this system.

She listed three important roles that foreign investment plays in China's economic development:

First, in the domestic cycle, foreign investment not only provides funds, but also brings advanced technology, management experience and global vision. Through the participation of foreign investment, especially foreign investment in high-tech, manufacturing, finance and other fields, China's industrial chain can be improved to a higher technical level and better management model.

Second, to promote the "international" circulation in the dual circulation. Foreign-funded enterprises in China are not only part of the domestic cycle, but also an important link between the domestic and international cycles. Through the introduction of foreign investment and international operations, foreign-funded enterprises can help Chinese enterprises expand into the international market, and also bring foreign advanced technologies, products and services into the Chinese market. This kind of international technology exchange, capital flow and market connection has formed an interactive mechanism of dual circulation.

Third, to deepen international cooperation and resource complementarity. Foreign investment in China not only promotes the development of the domestic market, but also promotes international economic cooperation through the cross-border flow of capital, technology and talent. The presence of foreign capital enables China to carry out closer economic cooperation, resource sharing and complementary advantages with more countries and regions in the world. (By Ma Ziqian/China Youth Daily)