Foreign investment still flowing
By Wang Yanlin |
May 15, 2010, Saturday
|
Print Edition
Print Edition
FOREIGN direct investment in China climbed for the ninth straight month in April, bolstered by China's strong economic performance and the government's relaxed rules to lure investors.
China will remain an attractive destination for foreign money because of its dynamic economy and people's expectations for a stronger yuan, analysts said.
Foreign investment rose 24.7 percent year-on-year to US$7.34 billion last month, a doubling of the increase of 12.08 percent in March, the Ministry of Commerce said yesterday.
The government approved the establishment of 2,047 overseas-funded companies last month, 21.3 percent more than a year earlier.
"Foreign investment in China has been increasing steadily and will continue to grow for a long period because of the great potential in the domestic market," said Li Maoyu, an analyst at Changjiang Securities Co.
"Besides, the Chinese government has reinforced its support for foreign investors last month, which led to quicker investment growth."
New incentives
The State Council, China's Cabinet, released new regulations in April to encourage sound overseas investment.
Under the new rules, China will give more support to foreign investors in high-tech industries and service sectors and will boost the development of energy-saving and environmental protection sectors.
Polluting and energy-gorging projects in industries running at overcapacity, on the other hand, are not wanted.
The central government also allowed local authorities to approve foreign investment projects of as much as US$300 million, busting the previous cap of US$100 million.
Karen Fawcett, group head of transaction banking at the Standard Chartered Bank, said in a recent article that Asia's emerging market economies have behaved like dynamos - able to generate self-sustained, domestically driven demand - rather than like dominoes facing the global financial crisis.
Market matures
In particular, Fawcett praised China's banking sector, saying it has been successful in moving onward and upward in stock market listings, strategic cooperation with international banks and stellar expansion.
Xue Jun, an analyst at CITIC Securities Co, said: "The growing maturity of China's investment environment has also become an important reason for foreign investors to come and stay."
"Better investment hardware enhanced China's strength in its fast economic advancement."
China's gross domestic product surged 11.9 percent from a year earlier in the first quarter, the fastest pace in more than two years.
Retail sales, a barometer of domestic demand, gained 18.1 percent on an annual basis through April, keeping a fast and steady growth momentum on various stimulus to boost people's spending.
China will remain an attractive destination for foreign money because of its dynamic economy and people's expectations for a stronger yuan, analysts said.
Foreign investment rose 24.7 percent year-on-year to US$7.34 billion last month, a doubling of the increase of 12.08 percent in March, the Ministry of Commerce said yesterday.
The government approved the establishment of 2,047 overseas-funded companies last month, 21.3 percent more than a year earlier.
"Foreign investment in China has been increasing steadily and will continue to grow for a long period because of the great potential in the domestic market," said Li Maoyu, an analyst at Changjiang Securities Co.
"Besides, the Chinese government has reinforced its support for foreign investors last month, which led to quicker investment growth."
New incentives
The State Council, China's Cabinet, released new regulations in April to encourage sound overseas investment.
Under the new rules, China will give more support to foreign investors in high-tech industries and service sectors and will boost the development of energy-saving and environmental protection sectors.
Polluting and energy-gorging projects in industries running at overcapacity, on the other hand, are not wanted.
The central government also allowed local authorities to approve foreign investment projects of as much as US$300 million, busting the previous cap of US$100 million.
Karen Fawcett, group head of transaction banking at the Standard Chartered Bank, said in a recent article that Asia's emerging market economies have behaved like dynamos - able to generate self-sustained, domestically driven demand - rather than like dominoes facing the global financial crisis.
Market matures
In particular, Fawcett praised China's banking sector, saying it has been successful in moving onward and upward in stock market listings, strategic cooperation with international banks and stellar expansion.
Xue Jun, an analyst at CITIC Securities Co, said: "The growing maturity of China's investment environment has also become an important reason for foreign investors to come and stay."
"Better investment hardware enhanced China's strength in its fast economic advancement."
China's gross domestic product surged 11.9 percent from a year earlier in the first quarter, the fastest pace in more than two years.
Retail sales, a barometer of domestic demand, gained 18.1 percent on an annual basis through April, keeping a fast and steady growth momentum on various stimulus to boost people's spending.
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