BEIJING, Nov 8: China has released new rules to prohibit or limit foreign investment in key industries as it seeks to cool its overheated economy and clean up its damaged environment, state press reported on Thursday.

In a wide-ranging directive published late on Wednesday, China’s key economic developmental agency identified sectors from real estate and financials to oil and rare metals as restricted or off limits to foreign capital.

Overseas investment that can help China to protect the environment, cut pollution and develop renewable energy will be encouraged, according to the National Development and Reform Commission statement.

Investment in high technology and advanced materials and equipment manufacturing will also be welcomed, but those in production industries in which China has mature technologies and capacity, will not be encouraged, it said.

The directive highlights Beijing’s latest policy initiative to restructure its export-driven economy whose booming but lopsided growth has for decades relied on government and foreign investment to expand.

China’s spectacular economic growth of the last three decades has come at a heavy price to its environment, while surging exports have created a huge trade surplus that is at the forefront of trade spats with major economic partners.

The government has said that China will readjust export-oriented trade policy amid a large trade surplus and surging foreign reserves that have topped $1.43 trillion.

Under the guidelines, foreigners are barred from investing in non-renewable mineral resources, such as tungsten, tin, antimony, molybdenum, as will investment in small and mid-sized oil refineries.—AFP