Ministry denies withdrawals by foreign investors
Print Edition
THE growth of China’s foreign direct investment remained weak in March, but there was no “wave of foreign investment withdrawals” as reported by some overseas media, the Ministry of Commerce said yesterday.
Foreign investors channeled US$12.4 billion into the country last month, up 2.2 percent from a year earlier. The pace of growth cooled further from the rise of 0.9 percent in February, and compared with a surge of 29.4 percent in January.
Shen Danyang, a ministry spokesman, said seasonal factors should be considered a factor as they usually fluctuate a good deal in the first three months of a year due to the Chinese New Year holiday.
“But on the whole, more foreign investors come to China than pull money out of the country,” Shen said.
In the first quarter, foreign investment grew 11.3 percent to US$34.9 billion, with 5,861 new foreign-invested firms being set up on China’s mainland. The number of foreign firms ending their business dropped 17.6 percent from a year earlier, while those reducing their investment fell 35.7 percent, Shen said.
“The so-called wave of investment withdrawals is likely a perspective from results of the industrial restructuring, as some manufacturing-sector investors are changing their business in China,” he said. “There are no big changes in China’s foreign investment situation, and it is a pure exaggeration to say there is a wave of withdrawals.”
Foreign investment growth was led by services, which grew 24.1 percent year on year to US$21.6 billion in the first three months and represented 61.9 percent of the total. Investment in manufacturing contracted 3.6 percent to US$11.2 billion during the period, or 32.2 percent.
“China remains an attractive place for foreign investors due to its massive market potential, good infrastructure construction and the continuous improvement of business environment,” Shen said.
Last year, China absorbed a total of US$119.6 billion non-financial foreign investment, up 1.7 percent year on year. It helped China surpass the US to become the world’s top destination for foreign investment.
In the first three months, investors from Saudi Arabia raised their capital in China by nearly 8 times from a year earlier to US$240 million as they expanded oil and chemicals projects in Fujian Province and Tianjin City, the ministry said.
Investment from the UK rose 40 percent to US$370 million in the January-March period while French investors injected the same amount, more than doubling the sum a year earlier. But investment from Japan dropped 12.3 percent and that from the US lost 40.4 percent.
Meanwhile, China’s outbound direct investment rose 0.4 percent to US$8.4 billion in March, moderating sharply from the pace of 68.2 percent in February due to seasonal factors.
It added 29.6 percent to US$25.8 billion in the first three months, with funds flowing into 2,331 overseas companies in 142 countries and regions.
China’s investment in the European Union expanded 8 times to US$3.5 billion during the period, mainly bolstered by a US$2.8-billion project by PetroChina in the Netherlands.
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