June’s FDI growth reaches 2-year high

By Song Shengxia Source:Global Times Published: 2013-7-17 23:38:01

Foreign direct investment (FDI) flowing into China in June posted the fastest growth in more than two years, data from the Ministry of Commerce showed Wednesday, indicating foreign investors are still optimistic about the long-term strength of China's economy.

Total FDI in the country soared 20.12 percent from a year earlier to $14.39 billion, the fastest growth since March 2011 and the fifth straight monthly increase since February.

"The FDI growth underlines the competitiveness of China's economy and international investors' recognition of the investment environment in China," Shen Danyang, spokesperson of the ministry, said Wednesday.

But Shen added a single month's data would not indicate a sustained rebound of the FDI, noting that he expects the figure to grow steadily in the second half.

The June data brought the figure in the first half to $61.98 billion, up 4.9 percent year-on-year. FDI to the service sector rose 12.43 percent from a year earlier in the first half, accounting for 49 percent of the total inflows.

FDI to the manufacturing sector dropped 2.14 percent year-on-year in the period, accounting for 42 percent of the inflows.

"The increase of foreign investment showed foreign investors see the long-term economic prospect in the country instead of the current weak growth," He Weiwen, co-director of the China-US-EU Study Center under the China Association of International Trade, told the Global Times.

"The increase of foreign investment to service sectors showed the upgrading of the investment structure," He added.

The FDI data came after the National Bureau of Statistics said Monday that the country's GDP grew 7.5 percent from a year earlier in the second quarter, down from the 7.7 percent in the first three months, marking the fifth straight quarter in which the economy grew below 8 percent.

China's economic growth "may not be as fast as before, but it is still very strong globally and is still providing our business with significant opportunities to invest, grow and partner," DuPont Vice President William S. Niebur told the Global Times on the sidelines of the APEC China CEO Forum in Beijing Saturday.

On Friday, the China Securities Regulatory Commission, the country's securities regulator, raised the ceiling on capital foreign investors can bring into China in an effort to attract more foreign investors amid the economic slowdown. The quota for Qualified Foreign Institutional Investors was increased to $150 billion from $80 billion.

Meanwhile, commenting on the foreign trade situation, Shen, the spokesperson, said China needs to overcome a lot of difficulties in order to achieve its trade growth target this year.

The government will soon release measures to stabilize exports and expand imports, Shen said, without giving further details.



Posted in: Business, Economy

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