Rise in foreign funding reflects investors’ faith
Print Edition
FOREIGN direct investment in China rose for the second straight month in October, suggesting sustained confidence in the world’s second-largest economy.
Investment in the period rose 1.3 percent year on year to more than US$8.5 billion, the Ministry of Commerce said yesterday.
The increase followed a 1.9 percent rise in September, which reversed dips of 14 percent in August and 16.9 percent in July.
Despite the upturn, foreign investment in the first 10 months fell 1.2 percent year on year to US$95.8 billion, with 19,239 new foreign ventures being established on China’s mainland, the ministry said.
Spokesman Shen Danyang said that a majority of multinational companies remain confident in China due to its stable social conditions, huge consumer base, skilled labor force and good infrastructure.
“With China’s proposal to revive the ancient Silk Road and construct a maritime Silk Road, the country will see new growth opportunities that create business potential for investors,” Shen said.
In the past week alone, China has sealed landmark free trade agreements with Australia and South Korea.
Investment from the United Kingdom and South Korea rose fastest in the year through October, with their respective contributions rising by 32.4 percent and 26.4 percent year on year, the ministry said.
In contrast, investment from Japan fell 42.9 percent in the period, while the United States and the European Union saw their input fall 23.8 percent and 16.2 percent respectively.
Shen said the reductions in investment reflected the current period of transition.
“Such countries used to be big investors in China’s manufacturing sector, but now we are turning to services, so they are adjusting,” Shen said.
As a sign of China’s efforts to restructure its economy, foreign investment in services in the first 10 months rose 6.6 percent year on year to US$53.1 billion, representing 55.4 percent of the total.
In comparison, investment in manufacturing fell 15.1 percent to US$32.5 billion, or 33.9 percent.
Meanwhile, China’s outbound direct investment in the January-October period rose 17.8 percent year on year to US$81.8 billion. In October alone, it fell 12.2 percent to US$6.9 billion due to a high comparative base, the ministry said.
In the same period, investment in the EU jumped 193 percent and in Japan surged 128 percent. Investment in Russia, meanwhile, fell 79 percent due to a high comparative base, the ministry said.
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