Foreign investments in China up 22%

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BEIJING: Foreign investment into China accelerated in November, government data showed on Tuesday, despite a worsening slowdown in the world’s second-largest economy and concerns over business risks.

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Foreign direct investment (FDI)—which excludes financial sectors—rose 22.2 percent year-on-year, the commerce ministry said, totalling $10.36 billion.

The figure compares with an increase of 1.3 percent in October to $8.53 billion. FDI had hit a four-year-low in August of $7.20 billion.

For the first 11 months of 2014, FDI amounted to $106.24 billion, the ministry said, an increase of 0.7 percent year-on-year.

“Investment from major countries and regions was generally stable,” commerce ministry spokesman Shen Danyang said.

Chinese authorities have this year launched anti-monopoly, pricing and other inquiries into foreign firms in sectors ranging from auto manufacturing and pharmaceuticals to baby milk, fuelling fears Beijing is targeting them, a charge the commerce ministry repeatedly denies.

China’s appeal as an investment destination has also been declining in recent years owing to rising labor and land costs and competition from other Southeast Asian countries such as Vietnam.

Officials have also blamed source country factors, such as Washington’s drive to move industrial production back to the United States.

China’s economy expanded 7.3 percent in the July-September quarter, slower than the 7.5 percent expansion in the previous three months and the worst result since 2009 at the height of the global financial crisis.

In the first 11 months, FDI fell 39.7 percent from Japan to $4.08 billion, 22.2 percent from the US to $2.46 billion, 9.8 percent from the European Union (EU) to $6.17 billion, and 23.6 percent from the Asean group of Southeast Asian countries to $5.87 billion.

British investment, meanwhile, jumped 28 percent to $1.25 billion, while that from South Korea increased 22.9 percent to $3.59 billion.

Investment by Chinese companies overseas, meanwhile, fell in November for the second consecutive month, the ministry said.

Overseas direct investment (ODI) was down 26.1 percent year-on-year in November at $7.92 billion and stood at $89.8 billion for the first 11 months, up 11.9 percent.

ODI had fallen 12.2 percent in October to $6.92 billion after soaring 90.5 percent in September to $9.79 billion.

AFP

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