Tags: China | foreign | direct | investment

China's Foreign Direct Investment Slows

Friday, 16 Sep 2011 10:44 AM

Foreign direct investment (FDI) in China slowed slightly in the first eight months of 2011 from a year ago although economists said the outlook is still positive given the higher growth rate in the world's second biggest economy.

The country drew $77.6 billion between January and August this year, up 17.7 percent from a year ago, the Ministry of Commerce said in a statement issued on its website (www.mofcom.gov.cn) late on Thursday.

That marked a slight slowdown from the 18.6 percent annual growth clocked in the January-July period and 18.1 percent in the first eight months of 2010.

In August, China attracted $8.4 billion in FDI, a rise of 11.1 percent compared with a year earlier.

The outlook for genuine FDI, however, still looks constructive, said Wei Yao, economist at Societe Generale in Hong Kong.

"Things are still not as bad as 2008 and we don't have that kind of liquidity crunch around the globe like last time," she said. "China's overall economic growth is still a very big comparative advantage ... so this is still the major attraction."

FDI into China, which surged in the years after the nation joined the World Trade Organisation in 2001, have rebounded since a slump during the global financial crisis.

Recently, China's growing services sector and lower-cost cities in central and western regions have become bigger magnets for foreign firms and investors are eager to secure a foothold in the world's fastest-growing major economy.

China aims to let investors use the yuan to pay for foreign direct investment from September, the Commerce Ministry said last month. But no details of that plan have come out.

© 2017 Thomson/Reuters. All rights reserved.

   
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Foreign direct investment (FDI) in China slowed slightly in the first eight months of 2011 from a year ago although economists said the outlook is still positive given the higher growth rate in the world's second biggest economy. The country drew $77.6 billion between...
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2011-44-16
Friday, 16 Sep 2011 10:44 AM
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