Daily Management Review

Direct foreign investment flow to China increases


Foreign direct investment in mainland China in January-April increased by 6.4% over the same period last year and amounted to 305.24 billion yuan (about $ 45.14 billion), according to the data of the Ministry of Commerce of the PRC.

In April, foreign direct investment in China grew by 6.3% in annual terms to 62.95 billion yuan. At the same time, there was a decrease in investment compared with March, when they amounted to 95.17 billion yuan.

Foreign direct investment in China from the United States grew by 24.3% in the first four months of 2019.

Direct non-financial investments of China abroad in January-April amounted to $ 34.64 billion.

China has expanded the powers of the National Development and Reform Commission (NDRC). Now it is responsible for reviewing foreign investments to ensure their compliance with “economic security”, which has become one of the government’s top priorities.

The Chinese authority is compared to the United States Foreign Investment Committee (CFIUS), an interdepartmental group that examines foreign investment. However, analysts say the Chinese commission has even broader powers.

The extended powers of the NDRC are based on China’s new foreign investment law, adopted by the National People’s Congress in March. The document includes a clause on reciprocity, allowing the Chinese authorities to deal with foreign firms.

Chinese investment is facing increasing attention and hostility in the United States and the European Union. According to experts, this may increase China’s propensity to retaliate, which will affect foreign firms.

source: reuters.com