China launches pilot programme to boost foreign investment in telecom sector

China has launched a pilot program to expand foreign investment in its value-added telecom services sector, allowing foreign companies to wholly own businesses such as internet data centres and engage in online data and transaction processing. The initiative is being implemented in four key regions – Beijing’s national demonstration zone, Shanghai’s free trade zone, the Hainan Free Trade Port, and Shenzhen’s socialist modernisation pilot zone.

The program aims to align China’s telecom sector with high-standard international economic and trade rules, improve regulatory frameworks, and reduce market barriers for foreign investors. By opening up sectors like cloud computing and computing power services, China seeks to diversify market supply, boost innovation, and foster greater integration of digital technologies across industries.

In response to this initiative, companies like HSBC are preparing to participate, with HSBC Fintech Services applying for an internet content provider permit to enhance its digital services and business transformation. The Ministry of Industry and Information Technology (MIIT) has committed to monitoring the program’s effects, possibly expanding its scope based on its success. By improving the business environment and encouraging new business models, China is positioning itself as a more attractive destination for foreign investment in the telecommunications sector.