New investment law suits this stage of development

The draft of the foreign investment law is to be presented to the country's top legislature for approval on Friday, and no one should underestimate its importance.

The three existing laws related to foreign investment - the law on Chinese-foreign equity joint ventures, on Chinese-foreign contractual joint ventures and on wholly foreign-owned enterprises - have played their roles in promoting China's opening-up in the past four decades. It would have been unimaginable for China to receive the most foreign direct investment for 26 consecutive years since 1992 among developing countries without these three laws.

However, with the size of the Chinese economy rising to be the world's second-largest, the rise in its labor costs, the country's much higher environmental requirements and the urgent need for higher quality economic growth and upgraded high-tech industries, opening the door wider to foreign investment has become a necessity.