China’s foreign direct investment inflows are expected to hit a new record in 2023 and will probably rank first in the world, experts said on Wednesday.
This is because the country’s FDI surge against headwinds last year has indicated foreign investors’ strong confidence in the Chinese economy, while the government’s ramped-up policy efforts are expected to boost economic recovery and expand FDI inflows into key industries, inland regions and major projects, they said.
Their comments came as the Ministry of Commerce said the country’s FDI in actual use hit more than 1.23 trillion yuan in 2022, up 6.3 percent year-on-year. In US dollar terms, the figure was 189.13 billion, up 8 percent year-on-year.
The performance was better than expected, given the domestic and external challenges, especially the growth rate for the manufacturing industry and major foreign investment projects — those with contractual foreign investment of more than $100 million each — being 46.1 percent and 15.3 percent, respectively.
“Amid subdued global FDI sentiments, the robust FDI growth last year indicated foreign investors are upbeat about the supersized China market and its improving business environment,” said Wei Jianguo, a former vice-minister of commerce and vice-chairman of the China Center for International Economic Exchanges.
“China will become more attractive to them, with the wider opening-up and the anticipated rebound in its economic activity following optimization of the COVID-19 measures,” he added.
Wei predicts FDI will grow at two digits to probably reach $220 billion to $230 billion in 2023, surpassing the United States, as the latter faces economic slowdown — and even a recession. China was the second-largest FDI recipient in 2021, behind the US, according to the United Nations Conference on Trade and Development.
In a circular released recently, the State Council said that China will support foreign-funded research and development centers, so that they can use large scientific research instruments, as well as reports and relevant data of major national science and technology programs, in accordance with Chinese laws.
Analysts have widely attributed China’s robust FDI performance to the combined effects of the country’s policy efforts and economic upgrade and expansion, which, they say, have largely offset disruptions from the epidemic and geopolitical issues.
Source: China Daily
