Multinational companies including Honeywell, Tesla, and Siemens Healthineers have become early participants in China's pilot program for value-added telecom services, following the country's recent relaxation of investment restrictions on foreign investment.
Launched on October 23 by the Ministry of Industry and Information Technology (MIIT), the pilot program aims to expand access to value-added telecom services in designated areas of Beijing, Shanghai, Hainan, and Shenzhen.
The initiative now allows foreign investors to fully own businesses in areas like internet data centers and online data processing. Previously, foreign ownership was limited to 50 percent.
In Shanghai, the program is piloted in the China (Shanghai) Pilot Free Trade Zone Lin-gang Special Area and the Pudong New Area.
On Thursday, Siemens Healthineers, Trafigura, Equinix, Honeywell, Budweiser, Kyndryl, and Liepin signed agreements to join the pilot program, Shanghai Daily learned from the program's promotional event held by Pudong government.
These companies represent a range of sectors including cloud services, smart manufacturing, healthcare, recruitment, and e-commerce.
Earlier this week, seven foreign companies, including Unity, signed agreements with the Lin-gang Special Area, financial news portal Yicai reported. They also included GLP, Tesla, and HSBC Fintech Services (Shanghai), according to China Daily.
China's telecom sector has experienced rapid growth in recent years, with the number of data center racks increasing at a compound annual growth rate of more than 30 percent since 2018. As of September, 2,220 foreign-invested companies had been licensed to operate telecom businesses in the country, according to the MIIT.
Pudong, as a pioneer and leader in the sector, currently leads with 1,967 licensed telecom companies, of which 427 are foreign-owned. The area has established over 26,000 5G base stations, providing comprehensive network coverage.
The expansion of value-added telecom services is expected to speed up the integration of new technologies like artificial intelligence and big data across industries. This development will enrich internet services and foster new business models in the digital economy, strengthening the connection between digital and real economies and boosting the growth of innovative business practices.