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China FDI data in May a mixed bag
June 17, 2014, 8:20 am

A train carrying train tracks runs on the Lanzhou-Xinjiang high speed railway in Hami, northwest China's Xinjiang Uygur Autonomous Region, Nov. 16, 2013 [Xinhua]

A train carrying train tracks runs on the Lanzhou-Xinjiang high speed railway in Hami, northwest China’s Xinjiang Uygur Autonomous Region, Nov. 16, 2013 [Xinhua]

Foreign direct investment (FDI) into China from South Korea and UK have seen a huge surge in the January-May period up 87.9 per cent and 62.2 per cent year on year, respectively, new official data revealed on Tuesday.

FDI into the Chinese mainland fell 6.7 per cent year on year to $8.6 billion in May, China’s Ministry of Commerce (MOC) said on Tuesday. Although, FDI into China’s service sector rose 19.5 per cent year on year to $27.5 billion.

In the first five months of 2014, the FDI, which excludes investment in the financial sector, came in at $48.9 billion, up 2.8 per cent from the same period last year, the ministry said.

In January-May, the top five investors in the Chinese mainland were Hong Kong, Taiwan, Singapore, South Korea and Japan.

Investment from South Korea and the UK saw the biggest rises, up 87.9 per cent and 62.2 per cent year on year.

FDI into China from the United States fell 9.3 per cent year on year while that from the European Union (EU) was down 22.1 per cent in the first five months to $2.58 billion.

A Commerce Ministry spokesperson Shen Danyang denied the drop in FDI from ASEAN nations was affected by Beijing’s tensions with neighboring countries.

Shen attributed the drop to a high comparative base last year resulting from big projects and said the decline did not represent any trend.

“Our economic and trade cooperation with the ASEAN is not affected by current factors in the neighboring areas,” he said.

Investment from the Association of Southeast Asian Nations (ASEAN) dropped 22.3 per cent to $2.54 billion.

Shen responded to a report from the EU Chamber of Commerce in China that found companies were less confident in China’s business climate.

He said problems that EU companies encountered are not new and the government is striving to solve them. He said China holds advantages in attracting foreign investment although there is room for improvement.

In late May, the ministry announced a three-month pilot program to streamline the approval process for FDI projects.

 

Source: Agencies