Direct foreign investment in China up more than 6%

AFP, BEIJING

Wed, Sep 18, 2013 - Page 15

Foreign direct investment (FDI) into China rose 6.37 percent year-on-year in the first eight months of this year, the government said yesterday, adding it was a sign of investor confidence in the world’s second-biggest economy.

Incoming FDI, which excludes financial sectors, reached US$79.77 billion for the January to August period, the commerce ministry said in a statement. For August alone the figure was US$8.38 billion, up 0.62 percent on last year.

That represented a substantial slowdown after rises of 24.13 percent in July and 20.12 percent in June.

However, that was mainly due to a high base figure a year ago commerce ministry spokesman Shen Danyang (沈丹楊) said.

“Such single month volatilities are insufficient to reflect changes in China’s overall FDI. There is no need to worry about [a reversal] in the trend,” he said at a press conference.

Investment maintained “quite fast growth” in the eight-month period, Shen said in a statement.

“FDI growth is expected to be higher than last year,” he told reporters, adding that improved momentum since February had proven foreign investors’ confidence in China’s competitiveness.

Recent financial market turmoil in developing economies would not affect China’s recovery trend, he said.

Incoming investment from the EU rose significantly, up 24.3 percent to US$5.44 billion, as it did from the US, up 18.0 percent to US$2.50 billion.

However, the vast majority of investment into China comes from a group of 10 Asian countries and regions including Hong Kong, Taiwan and Japan, and FDI from them only rose 7.87 percent on-year to US$68.63 billion in the eight-month period.

The figure for Japan alone was US$5.56 billion, up 9.45 percent.

Direct overseas investment from China in non-financial sectors rose 18.5 percent year-on-year to US$56.5 billion.

“Perhaps it won’t take too long for the size of China’s overseas investment to overtake FDI into China,” Shen said.

Investment in the seven major economies of Hong Kong, ASEAN, the EU, Australia, the US, Russia and Japan totaled US$39.11 billion, up 3 percent year-on-year.

Investment into Japan fell 25.0 percent and into Hong Kong it was down 11.4 percent.

China’s economy, the world’s second largest, expanded 7.7 percent last year, its slowest pace in 13 years.

Growth stood at 7.7 percent in the first three months of this year and slowed further to 7.5 percent in the April-June period, but recent data have pointed to renewed strength in the economy.