China Unveils 15-Point Plan to Stabilize Foreign Investment, Opening Education and Finance Sectors

China has unveiled its most comprehensive policy response to a sustained decline in foreign direct investment, with a 15-point action plan that opens the education, finance, and pharmaceutical sectors to greater foreign participation. The “Action Plan for Stabilizing and Optimizing Foreign Investment Utilization” was jointly issued by the Ministry of Commerce (MOFCOM), the National Development and Reform Commission (NDRC), and the Ministry of Finance on June 16, and publicly released on June 22, 2026, according to Xinhua News.

Context: Three Years of FDI Decline

The policy arrives against a backdrop of significant and sustained decline in foreign investment. China’s actual utilized FDI in 2025 was 747.77 billion yuan, down 9.5% year-on-year, following a 27.1% plunge in 2024 — the sharpest decline since 2008, as reported by Xinhua News. A Mitsui & Co. analysis noted that net FDI fell to just $4.5 billion in 2024, the lowest level since 1991.

In the first five months of 2026, FDI was down 8.6% year-on-year, though Vice Minister of Commerce Ling Ji noted at a press conference that the decline had narrowed by 4.6 percentage points compared to the same period in 2025, and the investment structure had further optimized, according to Xinhua’s FDI data report.

Key Opening Sectors

The action plan focuses on expanding market access in services, where foreign investment restrictions in manufacturing have already been eliminated. The three priority sectors are:

Education: China will expand pilot programs opening vocational training institutions, vocational colleges, and high-level STEM universities to foreign investment. Beijing’s National Demonstration Zone for Expanding Service Sector Opening will receive additional support.

Finance: The plan supports more foreign institutions in using risk management tools including government bond futures, and allows foreign institutions to conduct fund investment advisory services. Cross-border business management will be optimized with enhanced financing quotas for key foreign enterprises.

Pharmaceuticals: Detailed rules will be issued for segmented drug production, pilot zones for biotechnology and wholly foreign-owned hospitals will be expanded, and insurance companies will be encouraged to include more innovative drugs and devices in commercial insurance coverage.

15 Measures Across Five Pillars

The action plan, formulated by MOFCOM in coordination with 27 departments, is structured around five key areas, as detailed on the Chinese Government website:

1. Expanding Market Access — Beyond education, finance, and pharmaceuticals, the plan supports deeper opening in telecommunications, internet, and culture.

2. Improving Investment Convenience — Regulations on foreign M&A of domestic enterprises will be revised, cross-border data flow management optimized with industry-specific negative lists, and tax incentives for reinvestment of distributed profits implemented.

3. Enhancing Investment Promotion — The “Invest in China” brand will be strengthened with a digital comprehensive service platform, and encouraged and prohibited lists for local government investment attraction will be introduced.

4. Strengthening Service Guarantees — National treatment for foreign enterprises will be fully implemented, and foreign enterprises will be supported in participating in consumption-boosting initiatives.

5. Optimizing Foreign Investment Management — Regional coordination in investment attraction will be promoted, and informatization of foreign investment management improved.

Government Commitments and National Treatment

At the State Council Information Office press conference on June 22, Vice Minister Ling Ji emphasized that China’s foreign investment stock remains stable, with 533,000 foreign-invested enterprises holding a total stock of nearly $4 trillion by the end of 2025. Over 8,000 foreign enterprises increased their investment in China in 2025, up 10% year-on-year.

“To shape new advantages for attracting foreign investment during the ‘15th Five-Year Plan’ period, the Ministry of Commerce, together with NDRC, MOF, and 27 other departments, focused on common concerns of foreign-invested enterprises and formulated new measures to stabilize foreign investment,” Ling Ji said, as reported by China News Service.

MOF Treasury Department official Zheng Yong stressed that “treating all types of business entities, including foreign-invested enterprises, equally is the basic principle that China’s government procurement has always adhered to.” NDRC official Jing Qin added that the commission would focus on institutional opening-up, working to achieve compatibility of rules in areas such as property rights protection, government procurement, and finance.

Economic Significance

Foreign-invested enterprises have played a substantial role in China’s economy. During the 14th Five-Year Plan period (2021-2025), they contributed 262.7 trillion yuan in revenue and 21.4 trillion yuan in profits, with average annual growth of about 5%. They contributed approximately 2.5 trillion yuan annually in tax revenue — about one-seventh of national tax revenue — and employed over 30 million people annually.

Vice Minister Ling Ji highlighted a new trend, noting that “consumption boost has become a new track for foreign investment development in China,” citing data showing wholesale and retail FDI rose 22.6% year-on-year in the first five months of 2026, as reported by Caixin.

Outlook and Challenges

The plan is explicitly designed for the 15th Five-Year Plan period (2026-2030), signaling that attracting and stabilizing foreign investment is a strategic priority for China’s next phase of economic development. It addresses key pain points raised by foreign chambers of commerce, including data flows, government procurement, and national treatment.

However, foreign investment in China faces headwinds from geopolitical tensions, regulatory uncertainty, and slowing economic growth. A Mitsui & Co. analysis noted that net FDI fell to $4.5 billion in 2024, the lowest level since 1991, reflecting the structural challenges foreign investors face. The effectiveness of the new measures will depend heavily on implementation at local government levels, where enforcement has historically been uneven.

As China competes for global FDI amid intense international competition and structural challenges including demographic shifts, the coming months will reveal whether this comprehensive policy package can reverse the downward trend and restore foreign investor confidence.