China sees steady FDI growth in Jan-Aug amid opening up

Foreign direct investment (FDI) into the Chinese mainland saw steady growth in the first eight months this year amid the country's unwavering opening-up efforts, official data showed Thursday.

FDI expanded 6.9 percent year on year to 604 billion yuan in the January-August period, the Ministry of Commerce said.

A night view of Shanghai. [File Photo: VCG]

In U.S. dollar terms, FDI inflow grew 3.2 percent year on year to 89.26 billion dollars.

In August alone, FDI reached 70.89 billion yuan, up 3.6 percent year on year.

The steady increase came despite mounting global economic uncertainties, which analysts said that might push multinationals to make investment decisions more carefully.

A closer look at the data showed that foreign firms remained bullish on the Chinese market, especially in high-tech sectors of growth potential.

During the past eight months, a total of 27,704 new foreign-funded enterprises were established, with investment in high-tech industries surging 39.3 percent year on year to 174.8 billion yuan, accounting for 28.9 percent of the total FDI.

The high-tech manufacturing sector saw FDI inflow up 16.4 percent while FDI into high-tech service sector surged 58.4 percent.

"For us, China is not simply a large-scale consumer market, but also an important source of innovation as well as a major element of the industrial value chain," said Jochen Goller, president & CEO of BMW Group Region China, during a recent forum held over the past weekend in Beijing.

In the first seven months of this year, BMW saw car sales up 16.6 percent year on year to some 404,000 units in the highly-competitive Chinese market.

"This strong performance is reinforcing our confidence to further grow with China, and as a result, BMW is taking decisive actions to significantly increase our investment as well as to enlarge our footprint," Goller said.

Bucking the trend of protectionism, China has stepped up efforts to allow foreign investors wider access into the domestic financial and consumer markets, with a string of measures announced in recent months.

In a bid to open the financial markets, the country's forex regulator on Tuesday announced it would abolish the investment quota restrictions for Qualified Foreign Institutional Investors and Renminbi Qualified Foreign Institutional Investors, a move that would drive capital inflows into the country's stock market, analysts said.

In August, the country launched six new pilot free trade zones (FTZs), bringing the total number FTZs to 18, which serve as pioneers of the country's reform and opening up as they test new styles of foreign investment management and trade facilitation.

Matthew Echols, a corporate vice president of Coca-Cola, said the U.S. beverage giant is encouraged by China's efforts in improving its business environment such as the launch of new pilot free trade zones and the upcoming implementation of foreign investment law and is proud of its strong production innovation capabilities in China.

Thursday's data showed that China's pilot free trade zones saw FDI inflow up 23.3 percent year on year to 86.6 billion yuan in the first eight months, accounting for 14.3 percent of the total.

The country's continued opening-up has attracted investors from a wider range of countries. Foreign investment from the Republic of Korea surged 45.3 percent year on year in the first eight months, while FDI from the countries along the Belt and Road maintained steady growth of 6.3 percent, according to the ministry.