ABSTRACT
In 1979 China instituted its open door policy and began seeking to attract foreign investment. A good investment environment is the precondition for attracting foreign businesses to China. The quality of investment environment is not determined by a single factor but a combination of factors. The report concludes that the overwhelming majority of foreign investors surveyed agree that China's investment environment is developing in a favorable direction and those relevant Chinese policies, decrees, and tax laws are positive for foreign businesses. The Regulations on the Encouragement of Foreign Investment, promulgated on October 11, 1986, reflect the efforts of the Chinese government over the past few years to encourage foreign businesses to invest in China. Shortages of funds have hindered the development of China's coal industry despite the country's rich coal resources. Regulations aimed at encouraging foreign investment, promulgated by the State Council in October 1986, have been welcomed by foreign investors and have enhanced their enthusiasm for investing in China.
