FDI growth to remain robust over coming year

Chinas foreign direct investment (FDI) will continue to experience robust growth this year, following an increase of 23 percent in January, said the Ministry of Commerce.

The expansion will come despite accelerating inflation, and the establishment of a ministerial panel responsible for reviewing overseas takeovers of Chinese companies concerned with military or national security work.

The countrys strong economic growth and the transformation of the economy to one led by domestic consumption will help to sustain Chinas appeal to the foreign investors, said experts.

The ministry said on Thursday that Chinas FDI last month reached $10.03 billion, an increase of 23 percent and higher than the growth rate of 15.6 percent in December.

In 2010, foreign investment grew by 17.4 percent year-on-year to a record $106 billion.

In a statement released on Feb 13, the State Council said a ministerial committee will be set up to review approvals for proposed overseas merger and acquisition (M&A) deals concerning companies in the defense, agriculture, energy, transport, and technology sectors.

The new process raised questions about whether foreign investment in China would be affected.

Yao Jian, a spokesman for the ministry, said the government is confident about the influx of foreign investment, and the new mechanism is a sign that China is fulfilling its commitment to further open up market.

China is following international practice. Many nations have already adopted such an approval process. It will help China to further open up and improve policy transparency, he said.

The new rules will help improve the quality and structure of Chinas FDI and create a better environment for foreign businesses, he added.

During the past three decades, Chinas FDI activity was mainly realized through green investment.

During 2010s record FDI high, only 3 percent of the deals by value were made through M&A, whereas the global figure was more than 70 percent.

Mo re and more of the nations foreign investment deals will be made through M&A, and will probably rise to 8 or 10 percent, Yao said.

According to the ministry, the nations service industry continues to outperform the manufacturing sector in attracting foreign investment. In January, investment worth $4.69 billion went into the service sector, a rise of 31.8 percent, accounting for 46.8 percent of the total.

Chinas western region saw FDI surge 81 percent to $510 million, far exceeding that of the eastern part of the country which registered 23 percent.

Experts said Chinas greatest asset in attracting foreign investors is the fast-growing economy and the governments commitment to the stimulating domestic consumption.

Double-digit growth (in FDI) is an easy target to reach. Chinas strong attractiveness as an investment destination will remain for quite a long time, said Li Xiaogang, director of Foreign Investment Research Center at the Shanghai Academy of Social Sciences.

The worlds largest maker of digital cameras, Canon Inc, said it is considering expanding its production capacity in China to cut costs and counter mounting competition, according to Masaya Maeda, Canons head of image communications products operations, in an interview with Bloomberg.

McDonalds Corporation said the company will accelerate expansion and open 1,000 restaurants in China during the next three years, hoping to be well placed as the nation takes steps to spur individual incomes.


Comments

Post a Comment

Popular posts from this blog

Alibaba's Jack Ma expresses Yahoo interest

Image
Jack Ma, chairman and CEO of Alibaba Group, said he is very interested in buying all ofYahoo Inc. [File photo] Jack Ma, chairman and CEO of China's Alibaba Group, has said he is "very interested" in buying all of struggling Yahoo Inc. Alibaba spokesperson John Spelich confirmed that Ma made the remarks during his keynote speech at Stanford University in response to a question from a member of the audience. "Alibaba is very important to Yahoo, so is Yahoo to Alibaba," said Ma during a Q&A session. When he was asked which part of Yahoo he was interesting in, Ma responded, "the whole piece of Yahoo", Reuters reported. After Yahoo fired its CEO Carol Bartz, several U.S. media outlets singled out Ma as the outstanding candidate to succeed Bartz. Yahoo has reportedly also received inquiries from Microsoft, News Corporation and private equity firm Silver Lake Europe LLP. Alibaba faces a number of obstacles if it proceeds with its planned purchase of Yaho...
Keep reading

Shanghai port consolidates its position as world's busiest

Image
Shanghai, the world's busiest container port, will consolidate its title this year and leverage its record throughput to become a multi-faceted provider of port services. Containers lie at the Waigaoqiao port in Shanghai yesterday when the city witnessed 30 million TEUs cross its ports. [Shanghai Daily] The city, which overtook Singapore as the world's biggest container handler last year, saw its annual container traffic volume surpass 30 million 20-foot equivalent units (TEU) yesterday. The figure hits an unprecedented level in the world's port history and marks a new leg in Shanghai's voyage to become a global shipping center by 2020. China's remarkable trade boom is reflected in the Shanghai port numbers, which went from 7,951 TEUs in 1978 to 29.05 million TEUs in 2010. The city's customs oversaw a total of US$790 billion worth of imports and exports in the first three quarters of this year - a 19.3 percent year-on-year increase. And its port handled 23.9 mil...
Keep reading

Trade surplus falls as export reliance fades

CHINA'S traffic surplus fell by 6.4 percent in 2010 from a year earlier after supervision efforts to enlarge imports as well as revoke faith upon exports. The General Administration of Customs pronounced a surplus had been cut to US$183.1 billion. The proportion of surplus to total traffic worth declined to 6.2 percent in 2010 from 2009's 8.9 percent as well as 2008's 11.6 percent. Trade worth finished during US$2.97 trillion in 2010, a surge of 34.7 percent from a year earlier. Exports increasing 31.3 percent to US$1.58 trillion, whilst imports jumped to US$1.39 trillion, up 38.7 percent year-on-year. "While a lot of uncertainties still exist in a external world, China is correct to accelerate a gait of a economic restructuring as well as rely less upon exports," pronounced Xue Jun, an researcher during CITIC Securities Co. Both exports as well as imports shot to a jot down high final month. Exports in Dec increasing 17.9 percent upon an annual basis to US$154.1 ...
Keep reading