China gets 10.2% more FDIs in first 4 months
CHINA’S foreign direct investments jumped 10.2 percent in the first four months of this year, as the nation’s lower costs and market attracted a steady inflow of funds.
The amount of FDI totalled US$20.4 billion from January to April, the Ministry of Commerce told a press conference in Beijing yesterday. April saw a FDI flow of US$4.5 billion, up 5.5 percent from a year ago, the ministry said.
“Foreign direct investments into China have kept steady since last year as the nation shifted its focus to the quality instead of quantity of foreign funds (investments),” said Liang Futao, an analyst with Shenyin & Wanguo Securities Consulting Co.
He said the monthly FDI is around US$5.2 billion on average.
Investors are now being encouraged to pump investments to other sectors, including high-end manufacturing, research and development, services, agriculture and environment protection, Li Zhiqun, an official with the foreign investment department of the ministry, said earlier this year.
China’s continuous opening-up, a booming consumer market and lower costs continue to serve as magnets for foreign investments, even if the government has curbed funds heading to industries with high pollution, low energy efficiency and lower added value, industry officials have said.
Intel Corp, for instance, will spend US$2.5 billion to build its first computer-chip plant in China’s Dalian in Liaoning Province in the northeast, its first in Asia too, the US chip maker said earlier this year.
Caterpillar Inc, the world’s largest maker of earthmoving equipment, also opened a plant in eastern China’s Jiangsu Province.
Foreign-invested companies had more than 300,000 factories in China by the end of 2006, according to a report this month by HSBC Holdings Plc.
The second round of Sino-US strategic economic talks, set for next week, is expected to benefit long-term investment relationship between the two nations as topics of market opening and others will be addressed, Liang said.
Rising FDI also fueled the nation’s record foreign exchange reserves which have topped US$1.2 trillion, more than a fifth of the world’s total, industry officials said.
China’s FDI rose 4.5 percent last year to a record US$63 billion, according to the ministry.
Total FDI has surpassed US$700 billion since China accepted funds from overseas investors, Commerce Minister Bo Xilai said in March.