CHINA-ECONOMY

China’s Ministry of Foreign Affairs (MFA) announced on November 10, 2017, that with effect from June 2017 foreign new-energy carmakers like Tesla Inc. will be able to set up their own factories in free trade zones in China without a local partner. It said that the current 50% limit in the stake that foreign companies can have in car making factories in the country will be lifted as long as the companies are producing new-energy cars in free trade zones. MFA also said that tariffs will also be lowered for cars made by foreign firms and sold in China. Separately, China’s Ministry of Commerce said last month that Tesla was negotiating with the Shanghai government to build a production facility there. The Wall Street Journal reported that Tesla and the Shanghai government reached a deal to build a wholly owned electric-vehicle factory in the city’s free trade zone. A reason for foreign car makers wanting to go solo in China is protection of their intellectual property. Meanwhile, the research arm of Chinese oil giant PetroChina Co. issued a report saying the costs for new-energy vehicle will be comparable to traditional fossil fuel by 2030. Dai Jiaquan, Chief Researcher at PetroChina, said prioritizing the development of new-energy vehicles is crucial to China’s energy security and “If we want to reach the goal of reducing the country’s oil import to less than 70% by 2025, the country need to ramp up efforts to continue investment in the sector.”







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