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Nation sees 2013 rise in FDI

Date:2014-01-17 Views:0 Author:Li Qiaoyi Source:Global Times

The flow of foreign investment into China climbed by 3.3 percent to $12.08 billion in December, the 11th consecutive month of growth, figures from the Ministry of Commerce (MOFCOM) showed Thursday, indicating the ­economy's continued attraction to global investors.

For the whole of 2013, China ­attracted $117.59 billion in foreign ­direct investment (FDI), up 5.25 percent compared to a year earlier, Shen Danyang, a spokesman for the mini­stry, told a news conference in Beijing on Thursday.

This growth reversed a decline of 3.7 percent year-on-year in FDI into China in 2012.

The services sector was particularly appealing to global investors in the past year.

Foreign investment in the services sector rose by 14.15 percent year-on-year, and accounted for 52.3 percent of the country's actualized FDI for the year, according to the MOFCOM statistics. This was the first time it exceeded the 50 percent mark.

Foreign investment in social welfare, electric machine repair, and entertainment services also saw rapid growth last year, increasing by 368.63 percent, 308.8 percent and 117.42 percent, respectively.

In comparison, actualized FDI into the manufacturing sector saw a fall of 6.78 percent in 2013, with the industry receiving 38.7 percent of the total.

The services sector's development toward being the main attraction for overseas investment is consistent with the rebalancing of the economy, which requires an increase in domestic demand, Huo Jianguo, director of the Chinese Academy of International Trade and Economic Cooperation under MOFCOM, told the Global Times Thursday.

Noting that the country has further opened up the services sector to foreign investors following reform pledges made at the Third Plenary Session of the 18th Communist Party of China Central Committee in November, Huo forecast that FDI into the services sector would continue its upward trend.

Shen, the MOFCOM spokesman, also said that actualized FDI into China is likely to see further growth this year.

Global FDI will hit $1.6 trillion in 2014, and China is expected to ­remain the most-favored FDI destination worldwide, Shen said, citing a survey in October by the UN Confe­rence on Trade and Development.

An expected rebound in global economic growth this year is likely to strengthen overseas investment sentiment toward China, Li Wei, China economist at Standard Chartered Bank in Shanghai, told the Global Times Thursday.

Foreign investment flows into the country will increase by 7-8 percent in 2014, Li forecast.

But there are still some ­unfavorable factors that may affect the nation's ­attractiveness to foreign investment, Yang Weixiao, a Beijing-based macroeconomic analyst with Lianxun Securities Co, told the Global Times Thursday.

If the US and European markets see a robust rebound this year, it may persuade investors to pull back some of their investment to their home markets, which could cause fluctuations in China's FDI, Yang said, while noting that severe volatility is unlikely.

Expectations of continued yuan appreciation could also dent overseas investment sentiment, Yang noted.

Meanwhile, data from MOFCOM showed that the country's outbound investment into non-financial sectors rose by 16.8 percent to $90.17 billion last year.