| This study delves into the adjustment of Chinese policies on foreign investment in response to the changing macro-economic environment characterized by China's entry into the WTO and the new trend of international capital flow, searching for the direction, principles, and measures of the adjustment. I argue in the dissertation that Chinese policies on foreign investment since late 1970s have not only facilitated a large scale inflow of foreign capital that has played a crucial role in Chinese national economy, but also make possible China's avoidance of great shock caused by inflow of foreign capital while enjoying its positive effects. China's entry into the WTO, together with the emerging tendency of international investment will, however, constitute challenges to Chinese existing policies. Such challenges are manifested firstly in the contradiction between Chinese policies and rules of the WTO, and secondly in China's inadaptability to the new context after its integration into the world system. The former includes mainly the excessive constraint by market allowance policy, the inconformity of some provisions of Chinese management policy with the WTO regulations, and the deficiency of a united and transparent policy on foreign investment. The latter is demonstrated most notably in the market distortion and rent-seeking caused by excessive preferential policies, which in turn damage the equal competition between enterprises, and the deteriorating competition to offer more favor between regions, as well as the negative effects resulted from policies that attach more importance to import than to management. These challenges have dictated the adjustment of Chinese policies related. I claim the following guideline for the adjustment: China, after its entry into the WTO, based on the international investment rules of the WTO and the need of economic development, should remove both preferential policy and restricting policy on foreign investment, namely, transfer from a biased policy that allows both preference and restriction to an unbiased policy, which, to be more precise, can not be simply summarized as national treatment, but impartial policy on foreign investment. According to the above guideline, eight principles are put forward in the dissertation for the adjustment. They are: principle of internationalization, principle of liberalization, principle of reciprocity, principle of equality, principle of transparency, principle of import and management equally valued, principle of security, and principle of widening. Some pragmatic and efficient measures based on the eight principles are suggested to ensure that the adjustment achieve certain ends.The dissertation consists of six chapters:The study begins in the first chapter with an overview of theories of policy on foreign investment, offering a theoretical framework for the subsequent analysis. I explore in this chapter the theoretical base, target, and means of foreign investment policy adopted in the host country; and categorize foreign investment policies into restricting policy, incentive policy, and impartial policy. A new definition of liberalization offoreign investment policy is proposed. I define the liberalization of foreign investment policy in broad sense and narrow sense. In broad sense, liberalization of foreign investment policy means: (1) to alleviate or eliminate restricting foreign investment policy; (2) to alleviate or eliminate.encouragement of foreign investment policy; (3) to make foreign investment under effective supervision and administration. In narrow sense, I exclude (2) from the definition including only (1) and (3). The issue of international coordination is also probed in the chapter.The rules of international investment of the WTO are scrutinized in chapter 2. Their limitations are concluded as: (1) the liberalization of international investment stagnates in low level; (2) competition to offer preference is in urgent need to standardize; (3) restrictive business practice; (4) rules for international indi...
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