A total of $5.79 billion was invested in economic and trade cooperation zones in 2017.

The imports and exports of foreign-funded enterprises in China totaled $1.84 trillion in 2017, an increase of 9 percent compared with 2016.

Those imports and exports accounted for 44.8 percent of China's total foreign trade last year.

"Foreign-funded enterprises play a vital role in the improvement of China's research and development capacity," the report said.

Global top cross-border enterprises have established R&D centers, trained research workers and sponsored research projects in China to encourage technological innovation and entrepreneurship.

Foreign-funded enterprises have also promoted industrial upgrades in the auto industry, light industry and in retail trade.

Long Guoqiang, vice-president of the Development Research Center of the State Council, said in the report that China is facing the challenges of absorbing foreign capital under the new situation.

International competition to absorb cross-border direct investment is becoming increasingly fierce and the uncertainty of China's external economic and trade environment has increased, which has made it more difficult to attract investment, Long said.

However, Long wrote in the report that focusing on the opening-up of the service industry, China has expanded the accesses to foreign capital. China should create a legal and market-oriented business environment based on equal competition between domestic and foreign capital, and play the role of an open platform with special economic zones, economic and technological development zones, and free trade zones.